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HALLEY 


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EQUALITY 



BY JHE SAME AUTHOR 


THE AGRARIAN PROBLEM IN THE SIXTEENTH 
CENTURY 

Longmans, Green Co. 1912 

THE ACQUISITIVE SOCIETY 
G. Bell & Sons. 1921 

A DISCOURSE UPON USURY, BY THOMAS 
WILSON 

G. Bell & Sons. 1925. 

RELIGION AND THE RISE OF CAPITALISM 
John Murray. 1926 

LAND AND LABOUR IN CHINA. 

Allen & Unwin. 1932. 

WITH A. E. BLAND & P. A. BROWN 

ENGLISH ECONOMIC HISTORY: SELECT DOCU* 
MENTS 

G. Bell & Sons. 1914. 

WITH EILEEN POWER 

TUDOR ECONOMIC DOCUMENTS 
Longmans, Green & Co, 1924 



EQUALITY 


by 

R. H, TAWNEY 


LONDON 

GEORGE ALLEN & UNWIN LTD 


MUSEUM STREET 



FIRST PUBLISHED IN 1 93 1 
REVISED SECOND AND CHEAPER EDITION I93I 
THIRD EDITION (SUBSTANTIALLY REVI^d) 1 938 


AH rights reserved 


Made and Printed in Great Britain by C. Tinling & Co.. Ltd, 
Liverpool, London and Prescot, 



TO 


SIDNEY AND BEATRICE WEBB 

WITH 

GRATITUDE AND AFFECTION 




CONTENTS 


PAGB 

PREFACE jd 

CHAPTER I 

THE RELIGION OF INEQUALITY I 

CHAPTER II 

INEQUALITY AND SOCIAL STRUCTURE 39 

(i) The Meaning of Class 4.I 

(ii) The Economic and Social Contours 47 

(iii) Equality and Culture 71 

CHAPTER III 

THE HISTORICAL BACKGROUND gi 

(i) The Fall of Legal Privilege 92 

(ii) Equality of Opportunity 106 

(iii) The Old Problem in a New Guise 124 

CHAPTER IV 

THE STRATEGY OF EQUALITY 1 36 

(i) The Method of Redistribution 138 

(ii) The Growth and Significance of Communal 144 

Provision 

(iii) The Extension of the Social Services 163 

(iv) The Lion in the Path 184 

A* ix 



CONTENTS 


PAGX 

CHAPTER V 

THE CONDITIONS OF ECONOMIC FREEDOM I98 

(i) The Qjncent ration of Economic Power 198 

(ii) Liberty and Equality 207 

(iii) Industry as a Social Function 222 

CHAPTER VI 

DEMOCRACY AND SOCIALISM 247 

(i) Forms and Realities 248 

(ii) The Menace to Democracy 254 

(iii) The Premise of Socialism 260 

(iv) The Task before the Labour Party 269 

NOTES 281 

APPENDICES 288 

INDEX 292 



PREFACE 


An author who complies with a request to re- 
publish an old work after the lapse of eight years is 
fortunate if he does not wish to re-write it from 
beginning to end. I have not re-written Equality ; 
nevertheless, the present edition differs substantially 
from its predecessors. The introductory chapter, 
and certain other passages, have been omitted as 
no longer relevant. A new final chapter on 
problems which, when the book was composed, 
were still in the future, has been substituted for 
the brief concluding paragraphs of the preceding 
editions. Some pages have been added on other 
aspects of the subject which experience or reflec- 
tion has set in a new light. Figures, when 
necessary, have been brought up to date. 

Apart from these changes, the general argument 
of the book, like the realities with which it deals, 
remains unaltered. In its analysis of the ravages 
of the disease of inequality, and its account of the 
remedies by which — ^would the patient consent to 
take them — ^his malady could be cured, it errs 
throughout on the side of under-statement. Truth, 
however presented, does not always persuade ; but 
her persuasiveness suffers less from sobriety than 
from exaggeration. One point, however, may 
legitimately be underlined. It is still sometimes 
suggested that what Professor Pigou, in his latest 
work, calls “ the glaring inequalities of fortune and 
opportunity which deface our present civilisation 
are beneficial, irremediable, or both together. 



PREFACE 


xii 

Innocent laymen are disposed to believe that these 
monstrosities, though morally repulsive, are econo- 
mically advantageous, and that, even were they 
not, the practical difficulties of abolishing them 
are too great to be overcome. Both opinions, it 
may be said with some confidence, are mere 
superstitions, for which no shadow of convincing 
evidence has as yet been adduced. If the time 
ever existed when absurdities of the kind could 
invoke on their side the conclusions of economic 
science, that time is now over. The burden of 
proof rests to-day, not on the critics of the economic 
and social inequalities examined in the following 
pages, but on their defenders. 

Institutions which enable a tiny class, amounting 
to less than two per cent, of the population of Great 
Britain, to take year by year nearly one quarter of 
the nation’s annual output of wealth^ may appeal 
to the emotions of wonder, reverence and awe. 
One cannot argue with the choice of a soul ; and, 
if men like that kind of dog, then that is the kind 
of dog they like. But, whatever the sentimental 
reactions such phenomena evoke, one fact about 
them is not open to dispute. It is that, so far 
from being an economic asset, they are an economic 
liability of alarming dimensions. They involve, in 
the first place, a perpetual misdirection of limited 
resources to the production or upkeep of cqstly 
futilities, when what the nation requires for its 
welfare is more and better food, more and better 
houses, more and better schools. They mean, in 
the second place, that, for lack of these simple 
necessities, the human energies which are the 
source of all wealth are, in the case of the majority 
of the population, systematically under-developed 



from birth to maturity. They result, in the third 
place, in the creation of a jungle of vested interests, 
which stubbornly resist all attempts to reconstruct 
on juster and more rational lines the economic 
system inherited from the age before 1914, in the 
belief that reconstruction will diminish their profits. 
They produce, in the fourth place, a perpetual 
class-struggle, which, though not always obtrusive, 
is always active below the surface, and which is 
fatal to the mobilisation of co-operative effort. 
Whatever the ends which these features of our 
society may serve, economic efficiency is certainly 
not among them. To prize as an economic 
advantage the arrangements which produce them 
is not realism, but romance. It is to wear as a 
talisman a miU-stone round one’s neck. 

The attitude which, while admitting that 
capricious inequalities are a grave national disaster, 
shudders in tremulous apprehension at the in- 
superable obstacles impeding the path of humanity 
and commonsense is equally remote from practical 
realities. The truth is that, as far as the mere 
technique of the matter is concerned, the course 
to be steered is pretty well charted. In the ages 
when property was widely distributed, and when 
the greater part of it consisted of land, equipment 
and tools employed by their owners for the purposes 
of production, the transmission of wealth by 
inheritance was a useful institution. It ensured 
that the next generation stepped into the assets 
of the last, and that the work of the world was 
carried on without interruption. To-day, when 
three-quarters or more of the nation leave less 
than £100 at death, and nearly two-thirds of the 
aggregate wealth is owned by about one per cent. ^ of 



nv 


PREFACE 


it, inheritance is on the way to become Kttle more 
than a device by which a small minority of rich 
men bequeath to their heirs a right to free quarters 
at the expense of their fellow-countrymen. The 
limitations imposed on that right during the past 
half-century were greeted, when first introduced, 
with the usual cries of alarm ; and the alarm, as 
is not less usual, has been proved by experience to 
be mere hysteria. It is perfectly practicable, by 
extending those limitations and accelerating their 
application, to reduce the influence of inheritance — 
at present a strong poison — ^to negligible dimensions. 

No one seriously supposes, again, that the 
steps already taken to make health and education 
somewhat less of a class monopoly than till recently 
they were have been anything but wholly beneficial. 
In the light of the incidence of disease between 
different classes, and of the crushing educational 
disabilities of the great majority of children, no one 
ought to suppose that our task in those matters 
has been more than begun. There is no question, 
in this field, of good intentions being paralysed by 
uncertainty as to the nature of the measures 
required. Experts may differ on points of detail ; 
but there is sufficient agreement on the major 
issues of policy to keep administrators busy, were 
their hands untied, for the next fifteen years. With 
the knowledge now at our command, we can ensure, 
if we please, that the whole of the rising generation, 
irrespective of income or social position, grows up 
in an environment equally conducive to health, 
enjoys equal opportunities of developing its powers 
by education, has equal access, according to ability, 
to all careers, and is equally secure against being 
crushed by the contingencies of life. What prevents 



PREFACE 


effective action is, in the main, neither ignorance 
nor lack of resources. It is the temper which 
found its classical expression in the golden sentence 
of Sir George May and his colleagues, to the eflFect 
that, “ since the standard of education, elementary 
and secondary, that is being given to the child of 
poor parents, is already in very many cases superior 
to that which the middle-class parent is providing 
for his own child, we feel that it is time to pause in 
this policy of expansion.”* That naive idealisation of 
social class as the final and infallible criterion of 
public expediency is not confined to the particular 
topic to which those words refer. As long as that 
attitude persists — ^as long as powerful classes, instead 
of welcoming the extension to all their fellow- 
countrymen of necessaries and amenities long 
enjoyed by themselves, fume and splutter at the 
mere thought that their advantages may be shared — 
civilisation in England must be regardea as skin-deep. 

If, finally, in the days when the great industry 
was getting onto its feet, the dictatorship of the 
capitalist was an unavoidable evil, it is clearly to-day 
as unnecessary as it is mischievous. The conduct of 
great undertakings requires, no doubt, capacities of 
an unusual order, which is one reason why those who 
direct them ought not to be recruited, as they often 
are at present, by nepotism and personal influence. 
It is not, however, an unfathomable mystery, which 
no one but the Titans at any moment engaged in 
it can hope to master. The British nation is not 
without experience in matters of government and 
administration. To suggest that it is unable to 
mobilise the intelligence to conduct in the general 
interest services necessary to its welfare, and to 
make a better job of them than bankers, mine- 



XVI 


PREFACE 


owners and mill-owners have made since 1918, is 
to bring against it a charge of imbecility which 
its history, whatever the shadows upon it, does 
little to justify. Given, in short, the will to make 
an end of economic inequality and industrial 
autocracy, the technical and administrative difficul- 
ties involved present no insoluble problem. We may 
not succeed in establishing a parity of pecuniary 
incomes, nor is it important to do so. We can 
certainly, if we please, wind up for good and all 
the whole odious business of class advantages and 
class disabilities, which are the characteristic and 
ruinous vices of our existing social system. 

We can do so, given the will. But that, of course, 
is the crux of the matter. When this book first 
appeared, a reviewer remarked that its subject, 
though possibly of speculative interest, was without 
practical importance. Cultured sophists said the 
same in the Rome of the Gracchi, when the republic 
was on the eve of the half-century of civil wars 
which finally destroyed it. Seen in historical 
perspective, the attempt to combine the equality 
of civil and political rights, which is of the essence 
of democracy, with the inequality of economic and 
social opportunities, which is of the essence of 
capitalism, is still in its first youth. There is 
sufficient experience, however, to suggest that the 
result represents, at best, a transitional arrangement. 
As the mass of the population becomes conscious 
of the powers which democracy confers, they 
naturally use them to press their demands. In 
proportion as they use them, democracy itself 
wears a different, and less innocuous, guise in the 
eyes of classes who formerly regarded it with 
indifference. The fatalism which foresees in Great 



Britain the inevitable clash of irreconcilable 
opponents, which has destroyed political civilisation 
in Germany and Italy, is clearly out of place. So 
also, however, is the light-hearted optimism which 
assumes that, because so precarious an equipoise 
has maintained itself for half a century, it can be 
relied on with confidence to maintain itself for 
ever. It may well be the case that democracy 
and capitalism, which at moments in their youth 
were allies, cannot live together, once both have 
come of age. When that contingency arises, it is 
necessary to choose between them. 

The issue depends, not on the impersonal forces 
beloved by sciolists, but on the convictions of 
common men and their courage in acting on them. 
Whatever conclusions may be drawn from the 
history of the last decade, one, at least, is in- 
disputable. It is that democracy is unstable as a 
political system, as long as it remains a political 
system and nothing more, instead of being, as it 
should be, not only a form of government, but a type 
of society, and a manner of life which is in harmony 
with that type. To make it a type of society 
requires an advance along two lines. It involves, 
in the first place, the resolute elimination of all 
forms of special privilege, which favour some 
groups and depress others, whether their source be 
differences of environment, of education, or of 
pecuniary income. It involves, in the second 
place, the conversion of economic power, now often 
an irresponsible tyrant, into the servant of society, 
working within clearly defined limits, and account- 
able for its action to a public authority. 

Since to take these next steps is within our own 
power, we have less to fear from shocks from without 



xviii 


PREFACE 


than from nervelessness within. If, in this country, 
democracy falls, it will fall, not through any 
fortuitous combination of unfriendly circumstances, 
but from the insincerity of some of its professed 
defenders, and the timidity of the remainder. It 
will fall because, when there was still time to make 
it unassailable, public spirit was too weak, and class 
egotism too strong, for the opportunity to be seized. 
If it stands, it will stand, not because it has hitherto 
stood, but because ordinary men and women were 
determined that it should, and threw themselves 
with energy into broadening its foundations. To 
broaden its foundations means, in the conditions of 
to-day, to destroy plutocracy and to set in its place 
an equalitarian society. It is in the hope that this 
book may make some small contribution to that 
cause that it is now republished. 


R. H. TAWNEY. 



CHAPTER I 


THE RELIGION OF INEQUALITY 

Discoursing some sixty years ago on the text, 
“Choose equality and flee greed”, Matthew Arnold 
observed that in England inequality is almost a 
religion. He remarked on the incompatibility of 
that attitude with the spirit of humanity, and sense 
of the dignity of man as man, which are the marks 
of a truly civilized society. “On the one side, in 
fact, inequality harms by pampering; on the other 
by vulgarizing and depressing. A system founded 
on it is against nature, and, in the long run, breaks 
down”.^ 

Much has changed since Arnold wrote, and not 
least what he called the Religion of Inequality. 
The temper which evoked his criticism, the temper 
which regarded violent contrasts between the cir- 
cumstances and opportunities of different classes 
with respectful enthusiasm, as a phenomenon, not 
merely inevitable, but admirable and exhilarating, 
if by no means extinct, is no longer vociferous. Few 
politicians to-day would dwell, with Mr. Lowe, on 
the English tradition of inequality as a pearl beyond 
price, to be jealously guarded against the profane. 
Few educationalists would seek, with Thring, the 
founder of the Headmasters’ Conference and one 
of the most influential figures in the educational 
world of his day, to assuage the apprehension felt 
by the rich at the extension of education by 
arguing that “the law of labour” compels the 
majority of children to work for wages at the age 
of ten, and that “it is not possible that a class 



2 THE RELIGION OF INEQUALITY 

which is compelled to leave off training at ten 
years of age can oust, by superior intelligence, 
a class which is able to spend four years more in 
acquiring skill”. Few political thinkers would find, 
with Bagehot, the secret of English political insti- 
tutions in the fact that they have been created by 
a ‘^deferential people”; or write, as Erskine May 
wrote in his Democracy in Europe^ of the demoraliza- 
tion of French society, and the paralysis of the 
French intellect, by the attachment of France to the 
bloodstained chimera of social equality; or declare, 
with the melancholy assurance of Lecky, that liberty 
and equality are irreconcilable enemies, of which 
the latter can triumph only at the expense of 
the former. When Taine published his Notes sur 
r Angleterre in 1872, he could describe it, by contrast 
with France, as still haunted by the ghost of the 
feudal spirit, a country governed by 100,000 to 
120,000 families with an income of ^1,000 a year 
and upwards, in which “the lord provides for the 
needs of his dependent, and the dependent is proud 
of his lord”. It is improbable that, if he analysed the 
English scene to-day, even the relentless exigencies 
of historical antithesis would lead him to regard it 
as gilded with quite the same halo of haughty 
benevolence and submissive gratitude.^ 

Institutions which have died as creeds sometimes 
continue, nevertheless, to survive as habits. If the 
cult of inequality as a principle and an ideal has 
declined with the decline of the aristocratic society 
of which it was the accompaniment, it is less certain, 
perhaps, that the loss of its sentimental credentials 
has so far impaired its practical influence as to empty 
Arnold’s words of all their significance. It is true, 
no doubt, that, were he writing to-day, his emphasis 



THE RELIGION OF INEQUALITY 3 

and illustrations would be different. No doubt he 
would be less impressed hy inequality as a source 
of torpor and stagnation, and more by inequality 
as a cause of active irritation, inefficiency and 
confusion. No doubt he would say less of great 
landed estates, and more of finance; less of the 
territorial aristocracy and the social system repre- 
sented by it, and more of fortunes which, however 
interesting their origin, are not associated with 
historic names; less of the effects of entail and 
settlement in preventing the wider distribution of 
property in land, and more of the economic forces, 
in his day unforeseen, which have led to a progressive 
concentration of the control of capital; less of the 
English reverence for birth, and more of the English 
worship of money and economic power. But, if he 
could be induced to study the statistical evidence 
accumulated since he wrote, it is probable that he 
would hail it as an unanticipated confirmation of 
conclusions to which, unaided by the apparatus 
of science, he had found his way, and, while noting 
with interest the inequalities which had fallen, 
would feel even greater astonishment at those 
which had survived. Observing the heightened 
tension between political democracy and a social 
system marked by sharp disparities of circumstance 
and education, and of the opportunities which 
circumstance and education confer, he would find, 
it may be suspected, in the history of the two 
generations since his essay appeared a more im- 
pressive proof of the justice of his diagnosis than it 
falls to the lot of most prophets to receive. “A 
system founded on inequality is against nature, and, 
in the long run, breaks down.” 

Men are rarely conscious of the quality of the 



4 


THE RELIGION OF INEQUALITY 


air they breathe. It is natural that a later generation 
of Englishmen, if they admit that such criticisms 
may not have Ijeen without significance for the age 
to which they were addressed, should deny, never- 
theless, that they are relevant to their own. On a 
question of the kind, where the sentiments of all of 
us are involved, we are none of us reliable witnesses. 
The course of wisdom, therefore, is to consult 
observers belonging to other nations, who are 
accustomed to a social climate and tradition different 
from our own, and who are less practised, perhaps, 
in the art of not letting the left side of their brain 
know what the right side thinks. 

Anthropologists who study the institutions of 
primitive peoples are accustomed to devote some 
part of their work to a description of the curious 
ritual, by which, among such peoples, the gradations 
of the social hierarchy are preserved and emphasized. 
They draw a picture of the ceremonial distinctions 
which shelter the chiefs and their families from 
contact with the common herd of inferior men; of 
the karakia, the spells and incantations, by which 
they call down prosperity and provide employment 
for their followers; of the mana, the prerogatives 
of sovereignty and jurisdiction, whose infringement 
will cause pestilence or famine to smite the com- 
munity; of the tafus which are designed, therefore, 
to protect the mana from being outraged b/ the 
profane. The centre of the system, they inform us, 
IS the sanctity of class, which has a significance at 
once economic and religious, and the conviction that 
prosperity will be blighted and morality undermined 
if that sanctity is impaired. And this system, it 
seems, is so venerable and all-pervading, so hallowed 
by tradition and permeated with pious emotion, 



THE RELIGION OF INEQUALITY 5 

that not only does it seem inconceivable to its 
adherents that any other system should exist, but, 
until attention is called to it by the irreverent 
curiosity of strangers, they are often not even 
conscious of the fact of its existence. 

Not all communities are so fortunate as to become 
the subject of sociological investigation. The world 
is large and anthropologists are few, and the prob- 
lems of Melanesia and Malaya are so absorbing, 
that it is natural that science should not yet have 
found time to turn the full blaze of its searchlight 
upon Europe. But, though visitors to England do 
not pretend to have explored the mysteries of mana 
and karakia, they sometimes use expressions whose 
meaning appears to be not wholly remote from that 
attaching to those formidable words. 

They are interested in education, and comment, 
with Professor Clarke, now Principal of the Institute 
of Education in London, on the “class-saturated 
thinking” which persists in calling a certain kind of 
secondary school elementary, and deplore “the deep 
and historical social cleavage that runs right through 
English education to this day”, and ask with dismay: 
“Is English education to escape from the toils of 
religious sectarianism only to find itself involved in 
a much more pervasive and far-reaching conflict 
of social sectarianism?” They inquire into English 
industrial conditions, and express bewilderment, 
•with an American investigator, at the survival into 
the opening years of the present century of the 
doctrine that a certain wage is “enough for a 
workman”, a doctrine now, doubtless, less powerful 
than it was, but to which even recent comparisons 
of the economic outlook of America and England 
still continue to draw attention. They analyse the 



6 THE RELIGION OF INEQUALITY 

historical elements in English cultural life, and argue, 
with Herr Dibelius, that it has been impoverished 
because the tradition of a single group — das 
Gentlemanideal — ^has imposed itself on the rest as a 
national ideal, so that “England alone, of all modern 
peoples, has allowed its ethical outlook to be pre- 
scribed by a single type of human being”, and that 
“the Englishman’s social ethic is less deep and 
exacting than that of other civilized nations because 
it deliberately includes only a fraction of the common 
human ideal”. They discuss the psychology of con- 
temporary politics, and find, like Herr Wertheimer, 
that it is marked, “more than in any other country, 
by a strong element of what might be called prole- 
tarian snobbery”, which inspires the British working 
class with a “tenderly wistful interest in the vacuous 
doings of the upper ten thousand”. They attempt, 
like M. Andr^ Siegfried, a synthetic study of 
modern England, and are surprised to notice that 
even in the army, where it might be supposed that 
personal qualities were all-important, the English 
tradition, like that of pre-war Germany, and unlike 
that of France and the British Dominions, still 
prefers that the commissioned ranks should be 
recruited from what is sometimes described as “the 
officer class”, as though the capacity for leadership 
were an attribute, not of individual human beings, 
but of some particular social stratum. They return, 
like visitors from Australia and New Zealand, to 
renew association with their spiritual ancestry, and 
complain that England is not one nation, but two, 
and that, if they are at home in the one, they have 
little opportunity of mixing with the other, because, 
except in the world of public affairs, the circles are 
still largely self-contained and rarely intersect.® 



THE RELIGION OF INEQUALITY 7 

Such observers contrast what seems to them, 
rightly or wrongly, the element of stratification in 
English social arrangements with the tradition of 
equality which is the glory of France, where the 
spirit of an age when the word ‘‘aristocrat” was 
a term of abuse is not wholly forgotten, or with 
the easy-going democracy of the younger British 
communities, which have no aristocracy to remem- 
ber. They come to the conclusion that Englishmen 
are born with la mentaliU hiirarchique^ and that 
England, though politically a democracy, is still 
liable to be plagued, in her social and economic 
life, by the mischievous ghost of an obsolete tradi- 
tion of class superiority and class subordination. 
They find in the sharpness of English social divisions, 
and in the habit of mind which regards them as 
natural and inevitable, a quality which strikes them, 
according to their varying temperaments, as amusing, 
or barbarous, or grotesque. 

Here are these people, they say, who, more than 
any other nation, need a common culture, for, more 
than any other, they depend on an economic system 
which at every turn involves mutual understanding 
and continuous co-operation, and who, more than 
any other, possess, as a result of their history, the 
materials by which such a common culture might 
be inspired. Yet, so far from desiring it, there is 
nothing, it seems, which they desire less. They 
spend their energies in making it impossible, in 
behaving like the public schoolboys of the universe. 
Das Gentlemanideal has them by the throat; they 
frisk politely into obsolescence on the playing-fields 
of Eton. It is all very characteristic, and traditional, 
and picturesque. But it is neither good business nor 
good manners. It is out of tune with the realities 



8 THE RELIGION OF INEQUALITY 

of to-day. What a magnificent past Great Britain 
has had! 

It is mainly, of course, though by no means 
exclusively, of the strata which till recently set the 
tone of social life and national policy that such 
critics are thinking. Nor, though everyone will 
sympathize with their dissent from the diagnosis, 
is it easy for them to dissent from it convincingly; 
for, if the picture is a caricature, it is a caricature 
which, in their unguarded moments, they draw of 
themselves. One of the regrettable, if diverting, 
effects of extreme inequality is its tendency to 
weaken the capacity for impartial judgment. It 
pads the lives of its beneficiaries with a soft down of 
consideration, while relieving them of the vulgar 
necessity of justifying their pretensions, and secures 
that, if they fall, they fall on cushions. It disposes 
them, on the one hand, to take for granted them- 
selves and their own advantages, as though there 
were nothing in the latter which could possibly need 
explanation, and, on the other hand, to be critical 
of claims to similar advantages advanced by their 
neighbours who do not yet possess them. It causes 
them, in short, to apply different standards to 
different sections of the community, as if it were 
uncertain whether all of them are human in the 
same sense as themselves. 

Mr. H. G. Wells writes that what is called^the 
class war is an old habit of the governing classes.^ 
The temper which he describes, though no longer 
so aggressive and self-confident as in the past, is 
by no means extinct. It continues to find expression 
in an attitude which deplores in one breath the 
recurrence of class struggles, and the danger to 
prosperity caused by class agitation and the intrusion 



THE RELIGION OF INEQUALITY 9 

of class interests into politics, and defends in the 
next, in all innocence and good faith, arrangements, 
such as those involving, for example, educational 
inequality, which, whatever their merits, are cer- 
tainly themselves a cause of class divisions. It seems 
natural to those who slip into that mood of tranquil 
inhumanity that working-class children should go 
to the mill at an age when the children of the 
well-to-do are just beginning the serious business of 
education; and that employers, as the history of 
coal reveals, should be the sole judges of the manner 
of conducting an industry on which the welfare of 
several hundred thousand families depends; and 
that, while property-owners are paid compensation 
for disturbance, workmen should be dismissed 
without appeal on the word of a foreman; and that 
different sections of the community should be 
distinguished, not merely by differences of income, 
but by different standards of security, of culture, 
and even of health. When they are considering the 
provision to be made for unemployed wage-earners, 
they are apt to think it shocking that some men 
should be able to live without work, even though 
they have worked all their lives and are anxious to 
continue working. But, when they are repelling 
attacks upon property, they sometimes seem to 
think it monstrous that other men should not, even 
though they may never have worked seriously at all. 
Without any consciousness of inconsistency they 
wiU write to ^he Times, deploring in the first 
sentence the wickedness of some sections of the 
community in pressing for increased expenditure 
upon the social services which benefit them and 
their children, and urging in the next the importance 
of so reducing taxation that other sections may have 



lo THE RELIGION OF INEQUALITY 

more to spend on themselves. As long as they are 
sure that they are masters of the situation and will 
hold what they have, they are all kindness and 
condescension. Only question their credentials, 
however, and the lamb becomes a lion, which bares 
its teeth, and lashes its tail, and roars in every 
accent of grief and indignation, and will gobble 
up a whole bench of bishops, with the Archbishop 
of Canterbury at their head, if it imagines, as it 
imagined during the crisis of 1926, that the bishops 
are a party to laying hands upon its bone. 

Swift remarks that mankind may judge what 
Heaven thinks of riches by observing those upon 
whom it has been pleased to bestow them. Those 
who apply that maxim will be disposed, perhaps, 
to agree with Arnold’s contention that great 
inequalities, whatever other advantages they may 
possess, are likely, at all events, to be injurious 
to the rich. But the temper which regards such 
inequalities with indulgence is not at all confined 
to the rich, and the belief that it is confined to them, 
as though all that is needed, for a different spirit to 
prevail, were some external change in the machinery 
of society, is the politician’s illusion. 

Clearly, such a change is required, and, clearly, 
it is coming. Everyone who is not blind realizes, 
indeed, that, if the issue between individualism 
and socialism is merely a matter of the structure 
and mechanism of industry, then it has, in large 
measure, already been decided. Everyone sees that 
the characteristic of the phase on which the economic 
system is now entering will, as far as the larger 
and more essential undertakings are concerned, be 
some form of unified direction under public control. 
But then, if that is all that the issue means, though 



THE RELIGION OF INEQUALITY ii 

technically interesting, it is not of any great moment, 
except to specialists. Organization is important, but 
it is important as a means, not as an end in itself; 
and, while the means are debated with much zeal 
and ingenuity, the end, unfortunately, sometimes 
seems to be forgotten. So the question which is 
fundamental, the question whether the new organ- 
ization, whatever its form and title, will be more 
favourable than the old to a spirit of humanity 
and freedom in social relations, and deserves, 
therefore, that efforts should be made to establish 
it, is the object of less general concern and less 
serious consideration than the secondary, though 
important, problem, which relates to the procedure 
of its establishment and the technique of its 
administration. 

It is rarely considered, and more rarely finds 
overt expression in the world of public affairs. 
The reason is simple. An indifference to inequality, 
as the foreign observers remark, is less the mark 
of particular classes than a national characteristic. 
It is not a political question dividing parties, but a 
common temper and habit of mind which throws a 
bridge between them. Hence even those groups 
which are committed by their creed to measures for 
mitigating its more repulsive consequences rarely 
push their dislike of it to the point of affirming that 
the abolition of needless inequalities is their primary 
objective, by the approach to which their success 
is to be judged, and to the attainment of which other 
interests are to be subordinated. When the press 
assails them with the sparkling epigram that they 
desire, not merely to make the poor richer, but to 
make the rich poorer, instead of replying, as they 
should, that, being sensible men, they desire both. 



12 


THE RELIGION OF INEQUALITY 


since the extremes both of riches and poverty are 
degrading and anti-social, they are apt to take 
refuge in gestures of deprecation. They make war 
on destitution, but they sometimes turn, it seems, 
a blind eye on privilege. 

The truth is that, in this matter, judged by 
Arnold’s standard, we are all barbarians, and that 
no section or class is in a position to throw stones 
at another. Certainly a professional man, hke the 
writer of these pages, is not. 

High Heaven rejects the lore 
Of nicely calculated less and more : 

and how, when he accepts an income five times 
as large as that of the average working-class family, 
can he cavil at his neighbours merely because 
their consciences allow them to accept one twenty, 
or thirty, or fifty times as large? Certainly the mass 
of the wage-earners themselves, in spite of the 
immense advance which they have achieved since 
Arnold wrote, are but little better entitled to adopt 
a pose of righteous indignation. 

What the working-class movement stands for is 
obviously the ideal of social justice and solidarity, as 
a corrective to the exaggerated emphasis on indi- 
vidual advancement through the acquisition of 
wealth. It is a faith in the possibility of a society 
in which a higher value will be set on hutnan 
beings, and a lower value on money and economic 
power, when money and power do not serve human 
ends. But that movement is liable, like all of us, to 
fall at times below itself, and to forget its mission. 
When it does so, what it is apt to desire is not a 
social order of a different kind, in which money and 
economic power will no longer be the criterion of 



THE RELIGION OF INEQUALITY 13 

achievement, but a social order of the same kind, 
in which money and economic power will be some- 
what differently distributed. 

Its characteristic fault is not, as is sometimes 
alleged, that the spirit behind it is one of querulous 
discontent. It is, on the contrary, that a considerable 
number among those to whom it appeals are too 
easily contented — too ready to forget fundamental 
issues and to allow themselves to be bought off with 
an advance in wages, too willing to accept the 
moral premises of their masters, even when they 
dispute the economic conclusions which their masters 
draw from them, too distrustful of themselves and 
too much disposed to believe that the minority 
which has exercised authority in the past possesses 
a mana, a mysterious wisdom, and can wield a 
karakia, a magical influence bringing prosperity or 
misfortune.® Their sentiment is just, but their 
action is timid, because it lacks a strong root of 
independent conviction to nourish and sustain it. 
If leaders, their bearing not infrequently recalls, 
less the tribune, than the courtier : they pay salaams 
of exaggerated amplitude to established proprieties, 
as though delighted and overawed by the privilege 
of saluting them. If followers, they are liable, with 
more excuse, to behave on occasion in a manner at 
once docile and irritable, as men who alternately 
touch their hats and grumble at the wickedness 
of those to whom they touch them. 

Heaven takes, to paraphrase Homer, half the 
virtue from a man, when, if he behaves like a man, 
he may lose his job; and it is not for one who has 
not experienced the wage-earners’ insecurity to be 
critical of the wage-earners’ patience. But it would 
be better, nevertheless, both for them and for the 



14 THE RELIGION OF INEQUALITY 

nation as a whole, if they were more continuously 
alive, not only to their economic interests, but to 
their dignity as human beings. As it is, though they 
resent poverty and unemployment, and the physical 
miseries of a proletariat, they do not always resent, 
as they should, the moral humiliation which gross 
contrasts of wealth and economic power necessarily 
produce. While they will starve for a year to resist 
a reduction in wages, they still often accept quite 
tamely an organization of finance and industry 
under which a dozen gentlemen, who are not 
conspicuously wiser than their neighbours, deter- 
mine the conditions of life and work for several 
thousand families; and an organization of finance 
which enables a handful of bankers to raise and lower 
the economic temperature of a whole community; 
and an organization of justice which makes it 
difficult, as Sir Edward Parry has shown,® for a 
poor man to face the cost of obtaining it; and an 
organization of education which still makes higher 
education inaccessible to the great majority of 
working-class children, as though such children had, 
like anthropoid apes, fewer convolutions in their 
brains than the children of the well-to-do. 

They denounce, and rightly, the injustices of 
capitalism; but they do not always realize that 
capitalism is maintained, not only by capitalists, 
but by those who, like some of themselves^, would 
be capitalists if they could, and that the injustices 
survive, not merely because the rich exploit the 
poor, but because, in their hearts, too many of the 
poor admire the rich. They know and complain 
that they are tyrannized over by the power of 
money. But they do not yet see that what makes 
money the tyrant of society is largely their own 



THE RELIGION OF INEQUALITY 15 

reverence for it. They do not sufficiently realize 
that, if they were as determined to maintain their 
dignity as they are, quite rightly, to maintain their 
wages, they would produce a world in which their 
material miseries would become less unmanageable, 
since they would no longer be under a kind of 
nervous tutelage on the part of the minority, and 
the determination of their economic destinies 
would rest in their own hands. 

Thus inequality, as Arnold remarked, does not 
only result in pampering one class; it results also in 
depressing another. But what does all this mean 
except that the tradition of inequality is, so to say, 
a complex — a cluster of ideas at the back of men’s 
minds, whose influence they do not like to admit, 
but which, nevertheless, determines all the time 
their outlook on society, and their practical conduct, 
and the direction of their policy? And what can 
their denial of that influence convey except that 
the particular forms of inequality which are general 
and respectable, and the particular arrangement 
of classes to which they are accustomed, so far from 
being an unimportant detail, like the wigs of judges, 
or the uniform of postmen and privy councillors, 
seem to them so obviously something which all 
right-thinking people should accept as inevitable 
that, until the question is raised, they are hardly 
conscious of them? And what can the result of such 
an attitude be accept to inflame and aggravate 
occasions of friction which are, on other grounds, 
already numerous enough, and, since class divisions 
are evidently far-reaching in their effects, to cause 
it to be believed that class struggles, instead of 
being, what they are, a barbarous reality, which 
can be ended, and ended only, by abolishing its 



i6 THE RELIGION OF INEQUALITY 

economic causes, are permanent, inevitable or even 
exhilarating. 

The foreign critics, therefore, can console them- 
selves with the reflection that they have not, after 
all, aimed so wide of the mark. But to those who 
cannot regard the fate of their fellow-countrymen 
with the detachment of foreigners, these proofs of 
their predilection for worshipping images are less 
consoling. They will observe that the ritual of the 
cult is even more surprising than the albs and 
chasubles and aumbries, which so shocked the late 
Lord Brentford and the House of Commons a few 
years ago. They will note that its own devotees do 
not seem to find in it a source of unmixed gratifica- 
tion, since it keeps them in a condition of morbid 
irritation with each other, so that, however urgent 
the need for decisive action may be, such action is 
impossible, because, as has repeatedly been seen in 
the twenty years since 1918, defence and attack 
neutralize each other, as in trench warfare, and the 
balance of forces produces a state of paralysis. They 
will reflect that such a paralysis, which is the natural 
result of a divided will, is less noticeable in nations 
where classes are less sharply divided, and that, 
since a united will can no longer to-day be secured, 
as it was secured in the past, by restricting political 
power to the classes endowed with social power and 
opportunity, the time may have come, perhaps, to 
increase the degree in which the latter, as well as 
the former, are a common possession. They will ask, 
in short, whether one condition of grappling mor^ 
effectively with the economic difficulties of the 
nation — not to mention its intellectual and moral 
deficiencies — may not be, in the words of Arnold, 
to ^‘choose equality”. 



THE RELIGION OF INEQUALITY 


17 


Psychologists tell us that the way to overcome 
a complex is not to suppress it, but to treat it 
frankly, and uncover its foundations. What a com- 
munity requires, as the word itself suggests, is a 
common culture, because, without it, it is not a 
community at all. And evidently it requires it in a 
special degree at a moment like the present, when 
circumstances confront it with the necessity of giving 
a new orientation to its economic life, because it is 
in such circumstances that the need for co-operation, 
and for the mutual confidence and tolerance upon 
which co-operation depends, is particularly pressing. 
But a common culture cannot be created merely 
by desiring it. It must rest upon practical founda- 
tions of social organization. It is incompatible with 
the existence of sharp contrasts between the 
economic standards and educational opportunities 
of different classes, for such contrasts have as their 
result, not a common culture, but servility or 
resentment, on the one hand, and patronage or 
arrogance, on the other. It involves, in short, a large 
measure of economic equality — not necessarily in 
the sense of an identical level of pecuniary incomes, 
but of equality of environment, of access to educa- 
tion and the means of civilization, of security and 
independence, and of the social consideration which 
equality in these matters usually carries with it. 

And who does not know that to approach the 
question of economic equality is to enter a region 
haunted, not, indeed, ‘^by hobgoblins, satyrs, and 
dragons of the pit”, yet by a host of hardly less 
formidable terrors — ^‘doleful voices and rushings 
to and fro”, and the giant with a grim and surly 
voice, who shows pilgrims the skulls of those whom 
he has already despatched, and threatens to tear 



i8 THE RELIGION OF INEQUALITY 

them also in pieces, and who, unlike Bunyan’s giant, 
does not even fall into fits on sunshiny days, since 
in his territory the sun does not shine, and, even if 
it did, he would be protected against the weaknesses 
that beset mere theological ogres by the inflexible 
iron of his economic principles? Who does not 
recognize, when the words are mentioned, that 
there is an immediate stiffening against them in the 
minds of the great mass of his fellow-countrymen, 
and that, while in France and Scandinavia, and even 
in parts of the United States, there is, at least, an 
initial sympathy for the conception, and a disposition 
to be proud of such economic equality as exists, 
in England the instinctive feeling is one, not of 
sympathy, but of apprehension and repulsion, as 
though economic equality were a matter upon 
which it were not in good taste to touch? And who 
does not feel that, as a consequence of this attitude, 
Englishmen approach the subject with minds that 
are rarely more than half open? They do not 
welcome the idea, and then consider whether, and 
by what means, the difficulties in the way of its 
realization, which are serious enough, can be over- 
come. They recite the difficulties with melancholy, 
and sometimes with exultant, satisfaction, because 
on quite other grounds— grounds of history, and 
social nervousness, and a traditional belief that 
advantages which are shared cease to be advantages 
at all, as though, when everybody is somebody, 
nobody will be anybody — they are determined to 
reject the idea. ^ 

So, when the question is raised whether some 
attempt to establish greater economic equality may 
not be desirable, there is a sound of what Bunyan 
called ‘^doleful voices and rushings to and fro”. 



THE RELIGION OF INEQUALITY 19 

They rear, and snort, and paw the air, and affirm 
with one accord that the suggestion is at once 
wicked and impracticable. Lord Birkenhead, for 
example, declared that the idea that men are equal 
is ‘‘a poisonous doctrine”, and wrung his hands at 
the thought of the ‘‘glittering prizes” of life being 
diminished in value; and Mr. Garvin, with his eye 
for the dangers of the moment, and the temptations 
to which his fellow-countrymen are most prone to 
succumb, warns us against the spirit that seeks the 
dead level and ignores the inequality of human 
endowments; and Sir Ernest Benn writes that 
economic equality is “a scientific impossibility”, 
because Professor Pareto has shown, he says, that 
“if the logarithms of income sizes be charted on a 
horizontal scale, and the logarithms of the number 
of persons having an income of a particular size 
or over be charted on a vertical scale, then the 
resulting observational points will lie approxi- 
mately along a straight line”, and that, if only this 
were more generally known, the poor, like the 
wicked, would cease from troubling. A great 
industrialist, like Sir Herbert Austin, and a dis- 
tinguished minister of religion, like Dean Inge, 
rehearse, in their different ways, the same lesson. 
The former implores us to “cease teaching that all 
men are equal and entitled to an equal share of the 
common wealth”, and “enrich the men who make 
sacrifices justifying enrichment”, and “leave the 
others in their contentment, rather than try to 
mould material that was never intended to with- 
stand the fires of refinement”. The latter complains, 
in an address at Oxford — ^with a view, perhaps, 
to mitigating the class feeling which he rightly 
deplores — that “the Government is taking the pick 



20 THE RELIGION OF INEQUALITY 

of the working classes and educating them at the 
expense of the ratepayers to enable them to take the 
bread out of the mouths of the sons of professional 
men”. This deplorable procedure, he argues, cannot 
fail to be injurious to the nation as a whole, since it 
injures “the upper middle classes”, who are “the 
cream of the community”.’ 

When he hears this comminatory chorus directed 
against the idea of equality by men of such eminence, 
the first impulse of the layman is to exclaim with 
Moses, “Would God that all the Lord’s people 
were prophets!” He wishes that he himself, and all 
his fellow-countrymen, were capable of charting 
logarithms on horizontal and vertical scales in the 
manner of Sir Ernest Benn, and of escaping with 
confidence the dead-level of mediocrity so justly 
deprecated by Mr. Garvin, and of being moved by 
the righteous indignation which fills Dean Inge 
when he contemplates those vessels of wrath, the 
working classes. But he knows, to his dismay, that 
these gifts have been denied to ordinary men, and 
that it would, indeed, be a kind of presumption for 
ordinary men to desire them, for to do so would be 
to aspire to an impious and unattainable equality 
with their betters. So he is bewildered and con- 
founded by the perversity of the universe; he is 
oppressed by the weight of all this unintelligible 
world. If only the mass of mankind were more 
intelligent, they would realize how unintelligent 
their pretensions are. But they are condemned, it 
seems, to be unaware of their inferiority by the 
very fact of their inferiority itself. 


When an argument leads to an impasse, it is 



THE RELIGION OF INEQUALITY 21 

advisable to re-examine the premises from which 
it started. It is possible that the dilemma is not, 
after all, quite so hopeless as at first sight it 
appears to be. Rightly understood, Pareto’s law 
is a suggestive generalization; and the biological 
differences between different individuals are a 
phenomenon of great interest and significance; 
and Dean Inge is, doubtless, more than justified 
in thinking that the working classes, like all other 
classes, are no better than they should be, and in 
telling them so with the apostolic fervour which he 
so abundantly commands. It is the natural disposi- 
tion of clever and learned people to attack the 
difficult and recondite aspects of topics which are 
under discussion, because to such people the other 
aspects seem too obvious and elementary to deserve 
attention. The more difficult aspects of human 
relations, however, though doubtless the most 
interesting to nimble minds, are not always the most 
important. There are other ways than that of the 
eagle in the air and the serpent on the rock, which 
baffled the author of the Book of Proverbs. There 
are other sides of the truth about mankind and its 
behaviour than those which are revealed by bio- 
logical investigation, or expressed in the logarithms 
which delight the leisure of Sir Ernest Benn. 

It is these simpler and more elementary con- 
siderations that have been in the minds of those 
who have thought that a society was most likely to 
enjoy happiness and good will, and to turn both its 
human and material resources to the best account, 
if it cultivated as far as possible an equalitarian 
temper, and sought by its institutions to increase 
equality. It is obvious, indeed, that, as things are 
to-day, no redistribution of wealth would bring 



22 THE RELIGION OF INEQUALITY 

general affluence, and that statisticians are within 
their rights in making merry with the idea that the 
equalization of incomes would make everyone rich. 
But, though riches are a good, they are not, never- 
theless, the only good; and because greater pro- 
duction, which is concerned with the commodities 
to be consumed, is clearly important, it does not 
follow that greater equality, which is concerned 
with the relations between the human beings who 
consume them, is not important also. It is obvious, 
again, that the word ‘‘Equality’’ possesses more 
than one meaning, and that the controversies 
surrounding it arise partly, at least, because the 
same term is employed with different connotations. 
Thus it may either purport to state a fact, or 
convey the expression of an ethical judgment. On 
the one hand, it may affirm that men are, on the 
whole, very similar in their natural endowments 
of character and intelligence. On the other hand, 
it may assert that, while they differ profoundly as 
individuals in capacity and character, they are 
equally entitled as human beings to consideration 
and respect, and that the well-being of a society is 
likely to be increased if it so plans its organization 
that, whether their powers are great or small, all 
its members may be equally enabled to make the 
best of such powers as they possess. 

If made in the first sense, the assertion of 
human equality is clearly untenable. It is a piece of 
mythology against which irresistible evidence has 
been accumulated by biologists and psychologists. 
In the light of the data presented — to mention 
only two recent examples — in such works as Dr. 
Burt’s admirable studies of the distribution of 
educational abilities among school-children, or the 



THE RELIGION OF INEQUALITY 23 

Report of the Mental Deficiency Committee,® the 
fact that, quite apart from differences of environ- 
ment and opportunity, individuals differ widely 
in their natural endowments, and in their capacity 
to develop them by education, is not open to 
question. There is some reason for holding, for 
instance, that, while eighty per cent, of children at 
the age of ten fall within a range of about three 
mental years, the most backward may have a mental 
age of five, while the most gifted may have one of 
as much as fifteen. 

The acceptance of that conclusion, nevertheless, 
makes a smaller breach in equalitarian doctrines 
than is sometimes supposed, for such doctrines 
have rarely been based on a denial of it. It is true, 
of course, that the psychological and political theory 
of the age between 1750 and 1850 — the theory, for 
example, of thinkers so different as Helv6tius and 
Adam Smith at the beginning of the period, and 
Mill and Proudhon at the end of it — greatly under- 
estimated the significance of inherited qualities, 
and greatly overestimated the plasticity of human 
nature. It may be doubted, however, whether it 
was quite that order of ideas which inspired the 
historical affirmations of human equality, even in 
the age when such ideas were still in fashion. 

It is difficult for even the most sanguine of 
assemblies to retain for more than one meeting the 
belief that Providence has bestowed an equal 
measure of intelligence upon all its members. When 
the Americans declared it to be a self-evident truth 
that all men are created equal, they were thinking 
less of the admirable racial qualities of the in- 
habitants of the New World than of their political 
and economic relations with the Old, and would 



14 the religion of inequality 

have remained unconvinced that those relations 
should continue even in the face of proofs of bio- 
logical inferiority. When the French, whose attach- 
ment to the equalitarian idea roused the same horror 
a century and a quarter ago as that of the Russians 
does to-day, and who have had more success than 
the Russians in disseminating it, set that idea side 
by side with liberty and fraternity as the motto of 
a new world, they did not mean that all men are 
equally intelligent or equally virtuous, any more 
than that they are equally tall or equally fat, but 
that the unity of their national life should no longer 
be torn to pieces by obsolete property rights and 
meaningless juristic distinctions. When Arnold, 
who was an inspector of schools as well as a poet, 
and who, whatever his failings, was not prone to 
demagogy, wrote “choose equality”, he did not 
suggest, it may be suspected, that all children 
appeared to him to be equally clever, but that a 
nation acts unwisely in stressing heavily distinctions 
based on birth or money. 

Few men have been more acutely sensitive than 
Mill to the importance of encouraging the widest 
possible diversities of mind and taste. In arguing 
that “the best state for human nature is that in 
which, while no one is poor, no one desires to be 
richer”, and urging that social policy should be 
directed to increasing equality, he did not intend 
to convey that it should suppress varieties of indi- 
vidual genius and character, but that it was only in 
a society marked by a large measure of economic 
equality that such varieties were likely to find their 
full expression and due meed of appreciation.® 
Theologians have not, as a rule, been disposed to 
ignore the fact that there are diversities of gifts 



THE RELIGION OF INEQUALITY 25 

and degree above degree. When they tell us that 
all men are equal in the eyes of God, what they 
mean, it is to be presumed, is what Jeremy Taylor 
meant, when he wrote, in a book to-day too little 
read, that “if a man be exalted by reason of any 
excellence in his soul, he may please to remember 
that all souls are equal, and their differing operations 
are because their instrument is in better tune, their 
body is more healthful or better tempered; which is 
no more praise to him than it is that he was born 
in Italy”, It is the truth expressed in the parable 
of the prodigal son — ^the truth that it is absurd and 
degrading for men to make much of their intellectual 
and moral superiority to each other, and still more 
of their superiority in the arts which bring wealth 
and power, because, judged by their place in any 
universal scheme, they are all infinitely great or 
infinitely small. And, when observers from the 
Dominions, or from foreign countries, are struck 
by inequality as one of the special and outstanding 
characteristics of English social life, they do not 
mean that in other countries differences of personal 
quality are less important than in England. They 
mean, on the contrary, that they are more important, 
and that in England they tend to be obscured or 
obliterated behind differences of property and 
income, and the whole elaborate facade of a society 
that, compared with their own, seems stratified and 
hierarchical. 

The equality which all these thinkers emphasize 
as desirable is not equality of capacity or attainment, 
but of circumstances, institutions, and manner 
of life. The inequality which they deplore is not 
inequality of personal gifts, but of the social and 
economic environment. They are concerned, not 



26 THE RELIGION OF INEQUALITY 

with a biological phenomenon, but with a spiritual 
relation and the conduct to be based on it. Their 
view, in short, is that, because men are men, social 
institutions — property rights, and the organization 
of industry, and the system of public health and 
education — should be planned, as far as is possible, 
to emphasize and strengthen, not the class differ- 
ences which divide, but the common humanity 
which unites, them. 

Such a view of the life which is proper to human 
beings may, of course, be criticized, as it often has 
been. But to suppose that it can be criticized effec- 
tively by pointing to the width of the intellectual 
and moral differences which distinguish individuals 
from each other is a solecism, an ignoratio elenchi. 
It is true, of course, that such differences are im-. 
portant, and that the advance of psychology has 
enabled them to be measured with a new precision, 
with results which are valuable in making possible 
both a closer adaptation of educational methods to 
individual needs and a more intelligent selection 
of varying aptitudes for different tasks. But to 
recognize a specific difference is one thing; to pass a 
general judgment of superiority or inferiority, still 
more to favour the first and neglect the second, is 
quite another.^® The nightingale, it has been re- 
marked, was placed in the fourth class at the fowl 
show. Which of a number of varying individuals is 
to be judged superior to the rest depends upon the 
criterion which is applied, and the criterion is a 
matter of ethical judgment. That judgment will, 
if it is prudent, be tentative and provisional, since 
men’s estimates of the relative desirability of 
initiative, decision, common sense, imagination, 
humility and sympathy appear, unfortunately, to 



THE RELIGION OF INEQUALITY 27 

differ, and the failures and fools — the Socrates and 
St. Francis — of one age are the sages and saints of 
another. Society would not be the worse, perhaps, 
if idiots like Dostoievsky’s were somewhat less 
uncommon, and the condemnation passed on those 
who offend one of these little ones was not limited 
to offenders against children whose mental ratio is 
in excess of eighty-five. 

It is true, again, that human beings have, except 
as regards certain elementary, though still sadly 
neglected, matters of health and development, 
different requirements, and that these different 
requirements can be met satisfactorily only by 
varying forms of provision. But equality of provision 
is not identity of provision. It is to be achieved, 
not by treating different needs in the same way, 
but by devoting equal care to ensuring that they 
are met in the different ways most appropriate to 
them, as is done by a doctor who prescribes different 
regimens for different constitutions, or a teacher 
who develops different types of intelligence by 
different curricula. The more anxiously, indeed, a 
society endeavours to secure equality of considera- 
tion for all its members, the greater will be the 
differentiation of treatment which, when once their 
common human needs have been met, it accords to 
the special needs of different groups and individuals 
among them. 

It is true, finally, that some men are inferior to 
others in respect of their intellectual endowments, 
and it is possible — though the truth of the possi- 
bility has not yet been satisfactorily established — 
that the same is true of certain classes.^ It does not, 
however, follow from this fact that such individuals 
or classes should receive less consideration than 



28 THE RELIGION OF INEQUALITY 

Others, or should be treated as inferior in respect 
of such matters as legal status, or health, or economic 
arrangements, which are within the control of the 
community. 

It may, of course, be deemed expedient so to 
treat them. It may be thought advisable, as Aristotle 
argued, to maintain the institution of slavery on 
the ground that some men are fit only to be living 
tools; or, as was customary in a comparatively recent 
past, to apply to the insane a severity not used 
towards the sane; or, as is sometimes urged to-day, 
to spend less liberally on the education of the slow 
than on that of the intelligent; or, in accordance 
with the practice of all ages, to show less respect for 
the poor than for the rich. But, in order to establish 
an inference, a major premise is necessary as well as 
a minor; and, if such discrimination on the part of 
society is desirable, its desirability must be shown 
by some other argument than the fact of inequality 
of intelligence and character. To convert a pheno- 
menon, however interesting, into a principle, how- 
ever respectable, is an error of logic. It is the 
confusion of a judgment of fact with a judgment 
of value — a confusion like that which was satirized 
by Montesquieu when he wrote, in his ironical 
defence of slavery: ‘‘The creatures in question are 
black from head to foot, and their noses are so flat 
that it is almost impossible to pity them. It is not 
to be supposed that God, an all-wise Being, can have 
lodged a soul — still less a good soul — in a body 
completely black”. ' 

Everyone recognizes the absurdity of such an 
argument when it is applied to matters within his 
personal knowledge and professional competence. 
Everyone realizes that, in order to justify inequali- 



THE RELIGION OF INEQUALITY 29 

ties of circumstance or opportunity by reference to 
differences of personal quality, it is necessary, as 
Professor Ginsberg observes, to show that the 
differences in question are relevant to the in- 
equalities.^ Everyone now sees, for example, that 
it is not a valid argument against women’s suffrage 
to urge, as used to be urged not so long ago, that 
women are physically weaker than men, since 
physical strength is not relevant to the question of 
the ability to exercise the franchise, or a valid 
argument in favour of slavery that some men are 
less intelligent than others, since it is not certain 
that slavery is the most suitable penalty for lack 
of intelligence. 

Not everyone, however, is so quick to detect 
the fallacy when it is expressed in general terms. 
It is still possible, for example, for one eminent 
statesman to ridicule the demand for a diminution 
of economic inequalities on the ground that every 
mother knows that her children are not equal, 
without reflecting whether it is the habit of mothers 
to lavish care on the strong and neglect the delicate; 
and for another to dismiss the suggestion that 
greater economic equality is desirable, for the 
reason, apparently, that men are naturally unequal. 
It is probable, however, that the first does not think 
that the fact that some children are born with good 
digestions, and others with bad, is a reason for 
supplying good food to the former and bad food 
to the latter, rather than for giving to both food 
which is equal in quality but different in kind, and 
that the second does not suppose that the natural 
inequality of men makes legal equality a contemp- 
tible principle. On the contrary, when ministers of 
the Crown responsible for the administration of 



30 THE RELIGION OF INEQUALITY 

justice to the nation, they both took for granted 
the desirability and existence, at any rate on 
paper, of legal equality. Yet in the eighteenth 
century statesmen of equal eminence in France and 
Germany, and in the nineteenth century influential 
thinkers in Russia and the United States, and, 
indeed, the ruling classes of Europe almost every- 
where at a not very distant period, all were disposed 
to think that, since men are naturally unequal, the 
admission of a general equality of legal status 
would be the end of civilization. 

Our modern statesmen do not agree with that 
view, for, thanks to the struggles of the past, they 
have inherited a tradition of legal equality, and, 
fortified by that tradition, they see that the fact that 
men are naturally unequal is not relevant to the 
question whether they should or should not be 
treated as equal before the law. But they have not 
inherited a tradition of economic equality, for that 
tradition has still to be created. Hence they do not 
see that the existence of differences of personal 
capacity and attainment is as irrelevant to the 
question whether it is desirable that the social 
environment and economic organization should be 
made more conducive to equality as it is to the 
question of equality before the law, which itself, as 
we have said, seemed just as monstrous a doctrine 
to conservative thinkers in the past as the suggestion 
of greater economic equality seems to them to-day. 

And Sir Ernest Benn, who says that economic 
equality is a scientific impossibility, is quite uil- 
conscious, apparently, of the ambiguities of his 
doctrine. He ignores the obvious fact that, in some 
economic matters of the first importance — protec- 
tion by the police against violence and theft, and 



THE RELIGION OF INEQUALITY 31 

the use of the roads, and the supply of water, and the 
provision of sewers, and access to a minimum of 
education and medical attendance, all of which were 
once dependent on the ability of individuals to pay 
for them — all members of civilized communities are 
now secured equality irrespective of their personal 
attainments and individual economic resources. He 
fails to see that the only question is whether that 
movement shall be carried forward, or rather, 
since in fact it is carried forward year by year, how 
quickly society will decide to establish complete 
environmental equality in respect of the external 
conditions of health, and education, and economic 
security. So he behaves like the countryman who, 
on being for the first time introduced to a giraffe 
at a circus, exclaimed indignantly, “There ain’t no 
such animal.” He says that equality is a scientific 
impossibility, and draws a sharp line between the 
natural and, as he thinks, the healthy state of 
things, under which each individual provides all his 
requirements for himself, and the unnatural and 
morbid condition, under which the community, 
consisting of himself and his fellows, provides some 
of them for him. 

Such a line, however, is quite arbitrary, quite 
fanciful and artificial. Many services are supplied 
by collective effort to-day which in the recent past 
were supplied by individual effort or not supplied 
at all, and many more, it may be suspected, will 
be so supplied in the future. At any moment there 
are some needs which almost everyone is agreed 
should be satisfied on equalitarian principles, and 
others which they are agreed should be met by 
individuals who purchase what their incomes enable 
them to pay for, and others, again, about the most 



31 THE RELIGION OF INEQUALITY 

suitable provision for which opinions differ. Society 
has not been prevented from seeking to establish 
equality in respect of the first by the fear that in so 
doing it may be perpetrating a scientific impossi- 
bility. Nor ought it to be prevented from moving 
towards equality in respect of the second and third, 
if experience suggests that greater equality in these 
matters also would contribute to greater efficiency 
and to more general happiness. 

“But”, it will be said, “you are forgetting Pareto’s 
law, and the logarithms, and the observational 
points. These are hard realities. No ingenious 
sophistry will enable you to make light of them.” 
It is wrong, as we all know, to speak disrespectfully 
of the equator; and if the equator, which is a simple 
idea, deserves to be approached in a spirit of defer- 
ence, how much more is such deference incumbent 
on those who venture within the awful ambit of 
economic law? There is, however, as St. Paul says, 
one glory of the sun and another glory of the moon; 
there are powers celestial and powers terrestrial; 
there are laws and laws. There are scientific laws 
which state the invariable relations between phe- 
nomena, and there are juristic laws which state how 
men should conduct themselves, and there are laws 
which are neither juristic nor, in the full sense, 
scientific, though they belong, no doubt, to the 
same category as the latter. Such laws neither state 
invariable relations nor prescribe conduct, but 
describe how, on the whole, under given historical 
and legal conditions, and when influenced by 
particular conventions and ideas, particular groups 
of men do, as a rule, tend to behave. 

It is evident that, as economists have often 
reminded us, many economic laws are of the third 



THE RELIGION OF INEQUALITY 33 

class, not of the first or second. They indicate the 
manner in which, given certain historical con- 
ditions, and a certain form of social organization, 
and certain juristic institutions, production tends 
to be conducted and wealth to be distributed. 
They are not the less instructive and useful on that 
account, to those, at least, who know how to inter- 
pret them. But those who, though successful and 
rich, are not fully alive to the pitfalls which yawn for 
the unwary, and who are delighted when they hear 
of a law which jumps, as it seems to them, with their 
own instinctive preference for success and riches, 
sometimes find in economic laws a source of intel- 
lectual confusion, which it is distressing to all persons 
of humanity, and in particular, it may be suspected, 
to economists, to contemplate. They snatch at 
elaborate formulae in order to demonstrate that 
the particular social arrangements that they have 
been accustomed to admire are the product of 
uncontrollable forces, with which society can tamper 
only at its peril. They run to the fashionable 
nostrum of the moment, in order to shuffle off their 
responsibilities upon some economic automaton. 
Like a drunkard who pleads an alcoholic diathesis as 
an excuse for drinking, they appeal to economic 
laws, the majority of which are merely a description 
of the manner in which, in a certain environment 
and in given circumstances, men tend to behave, 
as a proof that it is impossible for them to alter their 
behaviour. 

. How men in given circumstances tend to behave, 
and how, as a consequence, wealth tends in such 
circumstances to be distributed, are subjects about 
which valuable and illuminating, if necessarily 
tentative, generalizations have been produced by 



34 THE RELIGION OF INEQUALITY 

economists. But their behaviour, as economists 
have often told us, is relative to their circumstances; 
and the distribution of wealth depends, not wholly, 
indeed, but largely, on their institutions; and the 
character of their institutions is determined, not 
by immutable economic laws, but by the values, 
preferences, interests and ideals which rule at any 
moment in a given society. 

These values and preferences are not something 
fixed and unalterable. On the contrary, they have 
changed repeatedly in the past, and are changing 
to-day; and the distribution of wealth has changed, 
and is changing, with them. It was of one kind in 
the France of the old regime, where a large part of 
the wealth produced was absorbed by the privileged 
orders, and quite another in France after the 
Revolution, where wealth previously paid in taxa- 
tion and feudal dues was retained by the peasantry. 
It is of one kind in Denmark to-day and of another 
kind in England. Thanks largely to changes in 
fiscal policy and to the development of the social 
services, which Sir Ernest Benn finds so distasteful, 
it is different in the England of 1937 from what 
it was in the England of 1857, and, if experience 
may be trusted, it will be different again in the 
England of 1957. To suppose, as he supposes, 
that it must necessarily be wrong to aim at greater 
economic equality, because Pareto suggested that, 
under certain conditions, and leaving the effects of 
inheritance, fiscal policy, and social services out^of 
account, the curve of distribution in several different 
countries and ages tended, as he thought, to conform 
to a certain shape, is a pardonable error, but an 
error none the less. It implies a misunderstanding 
of the nature of economic laws in general, and of 



THE RELIGION OF INEQUALITY 


35 


Pareto’s law in particular, at which no one, it is 
probable, would have been more amused than 
Pareto himself, and which, indeed, he expressly 
repudiated in a subsequent work.^ It is to believe 
in economic Fundamentalism, with the New Testa- 
ment left out, and the Books of Leviticus and 
Deuteronomy inflated to unconscionable propor- 
tions by the addition of new and appalling chapters. 
It is to dance naked, and roll on the ground, and cut 
oneself with knives, in honour of the mysteries of 
Mumbo- J umbo . 

Mumbo- Jumbo is a great god, who, if he is given 
his head, is disposed to claim, not only economics, 
but the whole world, as his kingdom, and who is 
subtle enough to deceive even the elect; so that Sir 
Ernest Benn is to be pitied, rather than blamed, 
for yielding to his seductions, and for feeling the 
same kind of reverence for Mumbo- Jumboism as 
was inspired in Kant by the spectacle of the starry 
heavens and by the moral law. But the power of 
Mumbo-Jumbo, like that of some other spirits, 
depends on the presence of an initial will to believe 
in the minds of his votaries, and can, if only they 
are not terrified when he sends forth his thunders 
and his lightnings — ^the hail of his logarithms and 
the whirlwind of his economic laws — be overcome. 
If, when he tells them that a certain course will 
result in the heavens falling, they summon up the 
resolution to pursue it all the same, they will find 
that, in a surprising number of cases, though they 
may have succeeded in improving the earth, the 
heavens, nevertheless, remain much where they were. 
And, when his prophets are so much alarmed by 
the symptoms of increasing equality, and by the 
demand for its still further increase, that they declare 



36 THE RELIGION OF INEQUALITY 

that equality is a scientific impossibility, they ought 
not, indeed, to be treated unkindly, or hewn in 
pieces before the Lord, like the prophets of an 
earlier Mumbo- Jumbo; but they should be asked 
to undergo, for the sake both of themselves and 
of their neighbours, what to nimble minds, with a 
gift for quick and sweeping generalization, is 
sometimes a hardly less painful discipline. They 
should be asked to study the facts. The facts, they 
will find, show that the distribution of wealth in 
a community depends partly, at least, upon its 
organization and institutions — its system of property 
rights, its economic structure, its social and financial 
policy — and that it is possible for it to give these 
matters a bias either towards greater equality or 
towards greater inequality, because different com- 
munities, at different times, have done, in fact, 
both the one and the other. 

Perhaps, therefore, the remote Victorian thinkers, 
like Arnold and Mill, who dealt lightly with 
Mumbo-Jumbo, and who commended equality 
to their fellow-countrymen as one source of peace 
and happiness, were not speaking so unadvisedly 
as at first sight might appear. They did not deny 
that men have unequal gifts, or suggest that all of 
them are capable of earning, as the author of 
The Confessions of a Captalist tells us that he 
earns,^^ 10,000 a year, or of making a brilliant 
show when their natural endowments are rigorously 
sifted and appraised with exactitude. What they 
were concerned to emphasize is something more 
elementary and commonplace. It is the fact that, in 
spite of their varying characters and capacities, men 
possess in their common humanity a quality which 
is worth cultivating, and that a community is most 



THE RELIGION OF INEQUALITY 37 

likely to make the most of that quality if it takes 
it into account in planning its economic organization 
and social institutions — if it stresses lightly differ- 
ences of wealth and birth and social position, and 
establishes on firm foundations institutions which 
meet common needs, and are a source of common 
enlightenment and common enjoyment. The indi- 
vidual differences of which so much is made, they 
would have said, will always survive, and they are 
to be welcomed, not regretted. But their existence 
is no reason for not seeking to establish the largest 
possible measure of equality of environment, and 
circumstance, and opportunity. On the contrary, it 
is a reason for redoubling our efforts to establish 
it, in order to ensure that these diversities of gifts 
may come to fruition. 

It is true, indeed, that even such equality,though 
the conditions on which it depends are largely 
within human control, will continue to elude us. 
The important thing, however, is not that it should 
be completely attained, but that it should be 
sincerely sought. What matters to the health of 
society is the objective towards which its face is set, 
and to suggest that it is immaterial in which direction 
it moves, because, whatever the direction, the goal 
must always elude it, is not scientific, but irrational. 
It is like using the impossibility of absolute cleanliness 
as a pretext for rolling in a manure heap, or denying 
the importance of honesty because no one can be 
wholly honest. 

It may well be the case that capricious inequalities 
are in some measure inevitable, in the sense that, 
like crime and disease, they are a malady which the 
most rigorous precautions cannot wholly overcome. 
But, when crime is known as crime, and disease as 



3* THE RELIGION OF INEQUALITY 

disease, the ravages of both are circumscribed by 
the mere fact that they are recognized for what 
they are, and described by their proper names, not 
by flattering euphemisms. And a society which is 
convinced that inequality is an evil need not be 
alarmed because the evil is one which cannot wholly 
be subdued. In recognizing the poison it will have 
armed itself with an antidote. It will have deprived 
inequality of its sting by stripping it of its esteem. 



CHAPTER II 


INEQUALITY AND SOCIAL STRUCTURE 

So to criticize inequality and to desire equality is 
not, as is sometimes suggested, to cherish the 
romantic illusion that men are equal in character 
and intelligence. It is to hold that, while their 
natural endowments differ profoundly, it is the 
mark of a civilized society to aim at eliminating 
such inequalities as have their source, not in indi- 
vidual differences, but in its own organization, 
and that individual differences, which are a source 
of social energy, are more likely to ripen and 
find expression if social inequalities are, as far 
as practicable, diminished. And the obstacle to 
the progress of equality is something simpler and 
more potent than finds expression in the familiar 
truism that men vary in their mental and moral, 
as well as in their physical, characteristics, im- 
portant and valuable though that truism is as a 
reminder that different individuals require different 
types of provision. It is the habit of mind which 
thinks it, not regrettable, but natural and desirable, 
that different sections of a community should be 
distinguished from each other by sharp differences 
of economic status, of environment, of education 
and culture and habit of life. It is the temper which 
regards with approval the social institutions and 
economic arrangements by which such differences 
are emphasized and enhanced, and feels distrust 
and apprehension at all attempts to diminish them. 

The institutions and policies in which that temper 
has found expression are infinite in number. At 

39 



40 INEQUALITY AND SOCIAL STRUCTURE 

one time it has coloured the relations between the 
sexes; at another, those between religions; at a 
third, those between members of different races. 
But in communities no longer divided hy religion 
or race, and in which men and women are treated 
as political and economic equals, the divisions 
which remain are, nevertheless, not insignificant. 
The practical form which they most commonly 
assume — the most conspicuous external symptom of 
difference of economic status and social position — 
is, of course, a graduated system of social classes, 
and it is by softening or obliterating, not individual 
differences, but class gradations, that the historical 
movements directed towards diminishing inequality 
have attempted to attain their objective. It is, 
therefore, by considering the class system that 
light upon the problem of inequality is, in the first 
place at least, to be sought, and it is by their attitude 
to the relations between classes that the equalitarian 
temper and philosophy are distinguished from their 
opposite. 

A society which values equality will attach a high 
degree of significance to differences of character 
and intelligence between different individuals, and 
a low degree of significance to economic and social 
differences between different groups. It will en- 
deavour, in shaping its policy and organization, 
to encourage the former and to neutralize and 
suppress the latter, and will regard it as vulgar and 
childish to emphasize them when, unfortunately, 
they still exist. A society which is in love with 
inequality will take such differences seriously, and 
will allow them to overflow from the regions, such 
as economic life, where they have their origin, and 
from which it is difficult wholly to expel them, till 



THE MEANING OF CLASS 


41 


they become a kind of morbid obsession, colouring 
the whole world of social relations. 


(i) 


The Meaning of Class 


The idea of ‘‘class”, most candid observers will 
admit, is among the most powerful of social cate- 
gories. Its significance is sometimes denied on the 
ground that, as Professor Carr-Saunders and Mr. 
Caradog Jones remark in their valuable book, a 
group described as a class may “upon many an issue 
be divided against itself”.^ But this is to confuse 
the fact of class with the consciousness of class, 
which is a different phenomenon. The fact creates 
the consciousness, not the consciousness the fact. 
The former may exist without the latter, and a 
group may be marked by common characteristics, 
and occupy a distinctive position vis-a-vis other 
groups, without, except at moments of exceptional 
tension, being aware that it does so. 

While, however, class is a powerful category, it 
is also an ambiguous one, and it is not surprising 
that there should be wide differences in the inter- 
pretations placed upon it both by sociologists and 
by laymen. War, the institution of private property, 
biological characteristics, the division of labour, 
have all been adduced to explain the facts of class 
formation and class differentiation. The diversity 
of doctrines is natural, since the facts themselves 
are diverse. Clearly, there are societies in which 
the position and relations of the groups composing 
them have been determined ultimately by the 



42 INEQUALITY AND SOCIAL STRUCTURE 

effect of conquest. Clearly, the rules under which 
property is held and transmitted have played a 
large part in fixing the conditions by which 
different groups are distinguished from each other. 
Clearly, there are circumstances in which the 
biological characteristics of different groups are a 
relevant consideration. Clearly, the emergence of 
new social groups is a natural accompaniment of 
the differentiation of economic functions — of the 
breaking up, for example, of a relatively simple and 
undifferentiated society into a multitude of special- 
ized crafts and professions, each with its different 
economic mitier^ its different training and outlook 
and habit of life, which has been the most obvious 
consequence of the transition of large parts of 
Europe from the predominantly agricultural civiliza- 
tion of two centuries ago to the predominantly 
industrial civilization of to-day. 

These different factors have, however, varying 
degrees of importance in different ages, different 
communities, and different connections. In western 
Europe, for example, the imposition of one race 
upon another by military force was of great im- 
portance during some earlier periods of its history, 
but in recent centuries has played but little part 
in modifying its social structure. Certain groups 
are marked, it seems, by different biological charac- 
teristics. Such characteristics require, however, the 
lapse of considerable periods to produce their result, 
while marked alterations in social structure mjiy 
take place in the course of a single lifetime. It is 
difficult to suppose that the broad changes in social 
classification which have occurred in the immediate 
past — the profound modification of class relations, 
for example, which was the result of the French 



THE MEANING OF CLASS 43 

Revolution, or the rise of new types of class system 
and the obliteration of the old, which has everywhere 
accompanied the development of the great industry, 
or the more recent growth of a nouvelle couche sociale 
of technicians, managers, scientific experts, pro- 
fessional administrators, and public servants — are 
most appropriately interpreted as a biological 
phenomenon. 

Nor, important though economic forces have 
been, can the gradations of classes be explained, as 
is sometimes suggested, purely as a case of economic 
specialization. It may be true, indeed, that the 
most useful conception of a class is that which 
regards it as a social group with a strong tinge of 
community of economic interest. But, while classes 
are social groups, not all social groups, even when 
they have common economic interests, can be 
described as classes. ^^Classes”, observed Lord 
Bryce, in writing of the United States of a genera- 
tion ago, ‘^are in America by no means the same 
thing as in the greater nations of Europe. One must 
not, for political purposes, divide them as upper 
and lower, richer and poorer, but rather according 
to the occupations they respectively follow.”^ His 
distinction between occupational and social divisions 
still retains its significance. Stockbrokers, barristers 
and doctors, miners, railwaymen and cotton-spinners 
represent half a dozen professions; but they are not 
normally regarded as constituting half a dozen 
classes. Postmen, bricklayers and engineers pursue 
sharply contrasted occupations, and often have 
divergent economic interests; but they are not 
distinguished from each other by the differences 
of economic status, environment, education, and 
opportunity, which are associated in common 



44 INEQUALITY AND SOCIAL STRUCTURE 

opinion with differences between classes. A com- 
munity which is marked by a low degree of economic 
differentiation may yet possess a class system of 
which the lines are sharply drawn and rigidly defined, 
as was the case, for example, in many parts of the 
agricultural Europe of the eighteenth century. It 
may be marked by a high degree of economic 
differentiation, and yet appear, when judged by 
English standards, to be comparatively classless, 
as is the case, for example, with some British 
Dominions. 

The conception of class is, therefore, at once 
more fundamental and more elusive than that of 
the division between different types of occupation. 
It is elusive because it is comprehensive. It relates, 
not to this or that specific characteristic of a group, 
but to a totality of conditions by which several sides 
of life are affected. The classification will vary, no 
doubt, with the purpose for which it is made, and 
with the points which accordingly are selected for 
emphasis. Conventional usage, which is concerned, 
not with the details of the social structure, but 
with its broad outlines and salient features, makes 
a rough division of individuals according to their 
resources and manner of life, the amount of their 
income and the source from which it is derived, 
their ownership of property or their connection 
with those who own it, the security or insecurity 
of their economic position, the degree to which 
they belong by tradition, education and associati9n 
to social strata which are accustomed, even on a 
humble scale, to exercise direction, or, on the other 
hand, to those whose normal lot is to be directed by 
others. It draws its class lines, in short, with reference 
partly to consumption, partly to production; partly 



THE MEANING OF CLASS 45 

by standards of expenditure, partly by the position 
which different individuals occupy in the economic 
system. Though its criteria change from generation 
to generation, and are obviously changing to-day 
with surprising rapidity, its general tendency is 
clear. It sets at one end of the scale those who can 
spend much, or who have what is called an inde- 
pendent income, because they are dependent for it 
on persons other than themselves, and at the other 
end those who can spend little and live by manual 
labour. It places at a point between the two those 
who can spend more than the second but less than 
the first, and who own a little property or stand 
near to those who own it. 

Thus conventional usage has ignored, in its 
rough way, the details, and has emphasized the 
hinges, the nodal points, the main watersheds. And 
in so doing, it has come nearer, with all its crudity, 
to grasping certain significant sides of the reality 
than have those who would see in the idea of 
class merely the social expression of the division of 
labour between groups engaged in different types 
of economic activity. For, though differences of 
class and differences of occupation may often have 
sprung from a common source, they acquire, once 
established, a vitality and momentum of their own, 
and often flow in distinct, or even divergent, 
channels. The essence of the latter is difference of 
economic function: they are an organ of co-operation 
through the division of labour. The essence of the 
former is difference of status and power: they have 
normally been, in some measure at least, the ex- 
pression of varying degrees of authority and subor- 
dination. Class systems, in fact, in the historical 
forms which they most commonly have assumed. 



46 INEQUALITY AND SOCIAL STRUCTURE 

have usually been associated — whence, indeed, the 
invidious suggestion which the word sometimes 
conveys — ^with differences, not merely of economic 
mitier^ but of social position, so that different 
groups have been distinguished from each other, 
not only, like different professions, by the nature 
of the service they render, but in status, in influence, 
and sometimes in consideration and respect. Even 
to-day, indeed, though somewhat less regularly 
than in the past, class tends to determine occupation 
rather than occupation class. 

Public opinion has in all ages been struck by 
this feature in social organization, and has used 
terms of varying degrees of appropriateness to 
distinguish the upper strata from the lower, describ- 
ing them sometimes as the beautiful and good, 
sometimes as the fat men, sometimes as the twice- 
born, or the sons of gods and heroes, sometimes 
merely, in nations attached to virtue rather than 
beauty, as the best people. Such expressions are 
not terms of precision, but they indicate a pheno- 
menon which has attracted attention, and which 
has certainly deserved it. The note of most societies 
has been, in short, not merely vertical differentiation, 
as between partners with varying tasks in a common 
enterprise, but also what, for want of a better term, 
may be called horizontal stratification, as between 
those who occupy a position of special advantage 
and those who do not. 

The degree to which such horizontal divisions 
obtain varies widely in the same community at 
different times, and in different communities at the 
same time. They are more marked in most parts of 
Europe than in America and the British Dominions, 
in the east of America than in the west, in England 



THE MEANING OF CLASS 


47 


than in France; and they were obviously more 
marked in the England of half a century ago than 
they are in that of to-day. Being in constant motion, 
they are not easily photographed, and they are 
hardly described before the description is out of 
date. But such divisions exist to some extent, it will 
be agreed, in most societies, and, wherever they 
exist to a considerable extent, they are liable, it 
will also be agreed, to be a focus of irritation*. 
Accepted in the past with placid indifference, they 
resemble, under modern political and economic 
conditions, a sensitive nerve which vibrates when 
touched, a tooth which, once it has started aching, 
must be soothed or extracted before it can be 
forgotten, and attention paid to the serious business 
of life. It is possible that they possess certain 
advantages; it is certain that they possess also 
certain grave disadvantages. The advantages — if 
such there are — are most likely to be enjoyed, and 
the disadvantages removed, if their main features, 
at any rate, are, in the first place, neither denounced, 
nor applauded, but understood. 


(ii) 


^he Economic and Social Contours 


Income, economists tell us, may be regarded from 
either of two points of view. It may be inter- 
preted as a product or as a dividend, as a stream 
of goods in process of creation, or as a stream of 
goods in process of consumption. And classes, which 
rest upon economic foundations, have two different 
aspects, which correspond to these different aspects 
c 



48 INEQUALITY AND SOCIAL STRUCTURE 

of the national income. They may be regarded, on 
the one hand, as composed of a series of economic 
groups, holding different positions in the productive 
system, and, as employer and employed, capitalist 
and wage-earner, landlord, farmer, and labourer, 
discharging different, if occasionally somewhat 
attenuated, functions within it. They may be 
regarded, on the other hand, as a series of social 
groups, distinguished from each other by different 
standards of expenditure and consumption, and 
varying in their income, their environment, their 
education, their social status and family connections, 
their leisure and their amusements. 

When attention is turned upon the organization 
of industry and the relations of the various interests 
engaged in it — their disputes, their agreements, 
their attempts to establish more effective co-operation 
or their failure to achieve it — rit is naturally the first 
aspect of the class system which springs into 
prominence. Society is regarded as an economic 
mechanism, the main elements in whose structure 
correspond to different classes. In discussions of 
the traditions, habits and manner of life by which 
different classes are characterized — the social insti- 
tutions which they have created, the types of schools 
which they attend, the varying environments in 
which they live — the feature which attracts atten- 
tion is naturally the second. Society then presents 
itself, not as a productive machine, but as an 
organism composed of groups with varying stan- 
dards of life and culture. The class system takes off 
its overalls or office coat, and wears the costume 
appropriate to hours of ease. 

Before goods can be consumed goods must be 
produced. It is obvious that these two aspects of 



THE ECONOMIC AND SOCIAL CONTOURS 49 

social organization are closely connected, as obverse 
and reverse, or flower and root. The material fabric 
of civilization is always crumbling and always being 
renewed; the wealth which renews it is hewn 
daily in the gloom of the mine and fashioned un- 
ceasingly in the glare of the forge. Both the 
hierarchy of the world of leisure, therefore, and 
the hierarchy of the world of productive effort, 
have their common foundation in the character 
and organization of the economic system. But, 
while they have a common foundation, the lines of 
the one are not a mere replica of those of the other. 
They correspond, but they do not coincide; in 
England, indeed, they coincide less closely than in 
younger communities, such as the United States, 
where the action of economic forces on the structure 
of society encounters fewer breakwaters built by 
tradition, and is therefore more simple, immediate, 
and direct. The social fabric is stretched upon an 
economic framework, and its contours follow the 
outlines of the skeleton which supports it. But it is 
not strained so taut as to be free from superfluous 
folds and ornamental puckers. Moulded, as it was, 
on the different structure of the past, it has not 
always adjusted itself with nicety to the angles of 
the present. It contains elements, therefore, which, 
like the rudimentary organs of the human body, 
or the decorative appendages of the British Constitu- 
tion, have survived after their function has 
disappeared and their meaning been forgotten. 

England is peculiar in being marked to a greater 
degree than most other communities, not by a 
single set of class relations, but by two, of which 
one is the product of the last century of economic 
development, and the other, though transformed 



50 INEQUALITY AND SOCIAL STRUCTURE 

by that development and softened by the social 
policy of the democratic era, contains, nevertheless, 
a large infusion of elements which descend from the 
quite different type of society that existed before 
the rise of the great industry. It is the combination 
of both — the blend of a crude plutocratic reality 
with the sentimental aroma of an aristocratic legend 
— ^which gives the English class system its peculiar 
toughness and cohesion. It is at once as business- 
like as Manchester and as gentlemanly as Eton; 
if its hands can be as rough as those of Esau, 
its voice is as mellifluous as that of Jacob. It is a 
god with two faces and a thousand tongues, and, 
while each supports its fellow, they speak in different 
accents and appeal to different emotions. Revolu- 
tionary logic, which is nothing if not rational, 
addresses its shattering syllogisms to the one, only 
to be answered in terms of polite evasion by the 
other. It appeals to obvious economic grievances, 
and is baffled by the complexities of a society in 
which the tumultuous impulses of economic self- 
interest are blunted and muffled by the sedate 
admonitions of social respectability. 

Regarded as an economic engine, the structure 
of English society is simpler than that of some more 
primitive communities. In spite of the complexity 
of its detailed organization, its main lines are drawn 
not by customary or juristic distinctions, which 
are often capricious, but by the economic logic of 
a system directed towards a single objective, ^the 
attainment of which, or the failure to attain it, can 
be tested by the arithmetical criterion of profit or 
loss. Its most obvious feature is also its most charac- 
teristic. It is the separation of the groups which 
organize, direct and own the material apparatus 



THE ECONOMIC AND SOCIAL CONTOURS 51 

of industry” from those which perform its routine 
work, and the consequent numerical preponder- 
ance of the wage-earning population over all other 
sections of the community. 

Such a separation and such a preponderance, on 
the scale on which they exist at present, are a novel 
phenomenon. Till a comparatively recent period 
in the history of most European countries, while 
political power was far more highly centralized 
than it is to-day, a high degree of economic cen- 
tralization was, apart from certain peculiar under- 
takings, the exception. The legal and social cleavage 
which divided different classes, the noble from the 
roturier^ the lord from the peasant, was often pro- 
found. But the control of the processes of economic 
life tended, of course with numerous exceptions, 
to be dispersed in the hands of large numbers of 
peasant farmers and small masters, who, subject 
to the discharge of their personal or financial 
obligations towards their superiors, conducted much 
of the humble routine of their economic affairs 
at their own discretion. Labour, property and 
enterprise were, to some considerable degree, not 
separated, but intertwined. Economic initiative 
and direction were fragmentary and decentralized. 
Conducted, not by mass attacks, but by individual 
skirmishes, the struggle with nature was ineffective 
because it was unco-ordinated. The organization 
of economic life, with its numerous tiny centres of 
energy, and its absence of staff-work and system, 
resembled that, not of an army, but of a guerrilla 
band. In the picture drawn in the well-known 
estimate of Gregory King, or in the more reliable 
statistics of the Prussian Census, which even in 1843 
showed only seventy-six workpeople to every hun- 



52 INEQUALITY AND SOCIAL STRUCTURE 

died masters, pre-industrial society appears, com- 
pared with our own, like a collection of fishing- 
smacks beside a battle-fleet. 

Over the greater part of the world, such, or some- 
thing like it, is still the normal type of economic 
structure. But the organization and class relations 
of industrial societies are obviously different. Their 
note is the magnitude of the group dependent on 
wages, compared with those which are interested in 
the ownership of property and the direction of 
economic enterprise. Statisticians have attempted to 
measure the degree of ^Troletarianisation” in 
different countries. They have produced tables in 
which they are graded according to the percentage 
which the wage-earners and humbler salaried officials 
form of the total occupied population, from Russia, 
with 12 to 14 per cent, of wage workers till a decade 
or so ago, Greece with 21, Bulgaria with 23, and 
France with 48, to the United States with 70 per 
cent., Australia with 71, Belgium and the Nether- 
lands each with 73, and Great Britain with 78.® The 
materials for such investigations are defective, and 
accurate results are not to be expected. What is 
significant, however, is the broad difference of type 
in the economic structure of communities at the 
two ends of the scale. At the one extreme there are 
those in which the wage-earners form a minority 
scattered up and down the interstices of a society 
composed predominantly of small property-owners; 
at the other extreme there are those in which ^he 
wage-earners form half, two-thirds, or even three- 
quarters of the whole occupied population. 

Of these two types of organization it is obviously 
the second which is characteristic of England. Not 
only is she the country where the urban and indus- 



THE ECONOMIC AND SOCIAL CONTOURS 53 

trial workers form the largest proportion of the 
total population, but her agricultural system itself, 
with its dependence on large numbers of landless 
agricultural labourers, approaches more closely to 
the industrial pattern than is the case in most 
other communities. The broad lines of her economic 
structure are revealed by the Census, according to 
which 5 '5 per cent, of the occupied population 
were in 1931 employers or managers, 76-6 per cent, 
employed, 11*8 per cent, unemployed, and 6’0 per 
cent, workers on their own account. Professor 
Bowley and Sir Josiah Stamp, adopting a different 
classification, estimated that, in 1924, 76 per cent, 
of the occupied population were wage-earners, 
14 per cent, salaried, 6 per cent, independent 
workers, and 4 per cent, employers, farmers, or 
engaged in professions.^ With the growing con- 
centration of industry, the proportion of salaried 
workers tends, it is probable, to increase, and of 
employers to diminish; the independent producers 
are numerically insignificant; while the small master 
with two or three journeymen, who is still so con- 
spicuous a figure in most continental countries, does 
not play a large part in most British industries, 
with the exception of agriculture, building, retail 
shopkeeping, and certain minor handicrafts. 

In the striking predominance of the wage- 
working population the United Kingdom resembles 
the United States, Australia, and Belgium, and is 
sharply contrasted, not only with communities, like 
Denmark, where agriculture is overwhelmingly the 
largest occupation, but with the countries possess- 
ing important manufacturing industries, like France, 
and, to a less extent, Germany. Apart, indeed, from 
mining, metallurgy, and textiles, the economic 



54 INEQUALITY AND SOCIAL STRUCTURE 

Structure of France is of a different pattern from 
that of England. For, while England has been the 
country of political stability and economic revolution, 
France is the classical land of political revolution 
and economic stability. She has known how to make 
the best both of the present and of the past. She has 
grafted the great industry on to her traditional 
social organization, without, as yet, seriously under- 
mining the latter. 

Thus, in French agriculture, in 1921, the 
labourers and farm-servants were actually fewer 
than the independent cultivators, the chefs exploit- 
ation^ numbering 2,834,127 as against 5,219,464, 
while approximately three-quarters of the latter 
were peasant proprietors.^ In French industry, when 
a census was taken in 1906, 20 per cent, of the 
occupied population were independent producers — 
travailleurs isoUs — neither working for others nor 
employing them, while 42 per cent, of her workers 
in manufacturing industry were employed in estab- 
lishments with not more than twenty employees, 
and only 22 per cent, in establishments with more 
than a hundred. In England the proportion of 
farm-land cultivated by occupying owners more than 
trebled between 1913 and 1927, rising from 10.7 
per cent, at the first date to over 36 per cent, at the 
second. But she is still unique in the degree to 
which, not only her urban, but her rural population 
consists of wage-earners; and, whereas in France 
the small producer has held his own, not only irf 
agriculture, but also in a considerable number of 
industries, in England, to an extent unknown else- 
where, he has lost his footing, not only in industry, 
but in agriculture. To a greater extent than is true 
pf any other nation her happiness, her efficiency. 



THE ECONOMIC AND SOCIAL CONTOURS 55 

her culture and civilization, depend upon the con- 
dition of the wage-earning population. 

This army of wage-earners, which forms over 
three-quarters of the nation, includes, of course, 
individuals of widely diverse incomes, economic 
positions, social conditions, personal interests and 
habits, types of culture, political opinions, and 
religious creeds. It is a class only when regarded 
from a limited economic angle, only in the sense 
that its members depend for their livelihood on the 
wage contract. But, though the economic side of 
life is not the only side, it has, nevertheless, an 
importance of its own, and the numerical pre- 
ponderance of the wage-workers is obviously the 
first characteristic of the structure of English society, 
when it is regarded in its economic aspect, as an 
organization for the production of wealth. 

There is also, however, a second characteristic, 
which is not necessarily, indeed, associated with the 
first, but which, in England at least, accompanies 
it. It is the remarkable degree to which the wage- 
earning section of the population tends to be 
distinct from the section which owns property. The 
wage-earning class might, of course, be in receipt 
of income from sources other than wages. It might 
combine work for wages with the ownership of 
property, and supplement its earnings by interest 
on investments, as many professional workers in 
fact do, or as the peasant in certain countries 
supplements income from property by intermittent 
work for wages. And to some extent, indeed, this 
is the case. Weekly wage-earners own a considerable 
volume of property in the form of individual, 
and, still more, of collective, savings, such as savings 
bank deposits, shares in building societies, money 
c* 



56 INEQUALITY AND SOCIAL STRUCTURE 

to their account in health, unemployment and life 
insurance funds, and in the funds of trade unions, 
co-operative societies, and friendly societies. 

In the aggregate, however, the amount thus 
owned, when set in relation to the number of adult 
wage-earners and to the property owned by other 
sections of the community, is impressive by its 
smallness rather than by its magnitude. To say 
that, except for their household goods and personal 
belongings, a large body of Englishmen are almost 
propertyless, and that an appreciable proportion 
of them — for example, the not inconsiderable 
number of miners who have been obliged to mort- 
gage such property as they possess — probably do not 
own wealth to the value of the kit that they took 
into battle at Paschendaele or on the Somme, has 
a displeasing air of rhetorical exaggeration. But, 
when the evidence advanced by statisticians is 
considered, it is difficult to resist the conclusion 
that in England the ownership of property is — to 
say the least — somewhat highly concentrated. 

Sir Josiah Stamp has given figures from which it 
appears that in 1919 about two- thirds of the 
aggregate wealth of the nation was held by just 
under 400,000 persons, or less than i per cent, of 
the population, and one-third of it by as few as 
36,000, or less than i per 1,000. According to 
Professor Clay, 64 per cent, of the wealth was in 
1 920-1 in the hands of i*6 per cent, of the persons 
holding property, which means (since such person^ 
form roughly one-half of the population) that 
rather less than two-thirds of the wealth was owned 
by *8 per cent, of the population. The figures of 
estates subject to the death duties do not suggest that 
a tendency to the wider distribution of property has 



THE ECONOMIC AND SOCIAL CONTOURS 57 

been operative since that date. In 1934-35, for 
example, 6*6 per cent, of the owners of dutiable 
estates owned 66*3 per cent, of the property, and 
36'4 per cent, of the property was actually owned 
by only I per cent, of them. The figure which 
Professor Clay gave for the capital owned in 1 920-1 
by 13,500,000 persons with less than ;^ioo was 
£^12,000,000 or 7-6 of the aggregate wealth; 
while Professor Carr-Saunders and Mr. Caradog 
Jones suggested 1,3 75, 000,000 as a “very rough 
estimate” of the accumulated savings of small 
investors in 1925. A more recent calculation 
puts such savings as ^^1,73 1,000,000 in 1934, 
inclusive of savings certificates, and 3 3 8,000,000 
exclusive of them. International comparisons are full 
of pitfalls, but the figures adduced by Professor Clay, 
and by Mr. Wedgwood in his admirable book. The 
Economics of Inheritance, suggest that the inequality 
in the distribution of property is somewhat greater 
in England than in France and Ireland, and con- 
siderably greater than in Australia.® 

It is clear, therefore, that, even when allowance 
is made for deficiencies and ambiguities in the 
statistical evidence, the earnings of the three- 
quarters to four-fifths of the population who live 
by wages are only to a small extent supplemented 
by receipts from property. While the distribution 
of income is less unequal than that of wealth, this 
concentration of property gives a peculiar and 
distinctive stamp to the social structure of England, 
which differentiates it sharply from that of some 
other communities. Marriage, Mr. Chesterton has 
somewhere observed, would not be regarded as a 
national institution if, while a small minority of 
the population were polygamous, the majority did 



58 INEQUALITY AND SOCIAL STRUCTURE 

not marry at all; and property can hardly be said 
to be a national institution in England, in the sense 
in which it was a national institution in some 
earlier ages, or as it is a national institution in 
some other countries to-day. Where conditions are 
such that two-thirds of the wealth is owned by 
approximately one per cent, of the population, the 
ownership of property is more properly regarded 
as the badge of a class than as the attribute of a 
society. 

A famous theory has suggested that the progressive 
concentration of ownership in the hands of a 
diminishing number of owners is a tendency in- 
herent in capitalist civilization. The generaliza- 
tion was prompted by the contrast between the 
distribution of property in England in the early 
days of the great industry and that obtaining in 
the contemporary peasant societies of the Continent, 
where the great industry had hardly as yet got on 
to its feet, and it has not been confirmed by the 
subsequent course of economic history. While the 
difference between the character and significance of 
property in these two types of community is not 
less impressive than it was, it is a difference between 
two phases of economic development, not, as Marx 
is usually understood to have suggested, between 
the earlier and later stages of the same phase. So 
far from diminishing, as he seems to have antici- 
pated would be the case, the number of property- 
owners in England has tended, if anything, to 
increase in the course of the last half-century. 
Though still astonishingly small, it is probably 
larger to-day than at any time since he wrote. 

But, of course, the distinction between the 
majority, who are mainly dependent on wages, and 



THE ECONOMIC AND SOCIAL CONTOURS 59 

the minority, who are largely concerned with pro- 
prietary interests, is not the only significant line 
of division in the economic system. There is also 
the familiar division between the directed and the 
directors; between those who receive orders and 
those from whom orders proceed; between the 
privates and the non-commissioned officers of the 
industrial army and those who initiate its opera- 
tions, determine its objective and methods, and 
are responsible for the strategy and tactics on 
which the economic destiny of the mass of man- 
kind depends. Since the control of industrial 
enterprise belongs in law to the ordinary share- 
holder, and in practice to the entrepreneurs who 
command the use of his savings and act on his 
behalf, the proprietary classes, either personally 
or through their agents, take, as seems to them 
expedient, the decisions upon which the organi- 
zation and conduct of industry depend, and, 
within the limits prescribed by law or established 
by voluntary agreement, are responsible for their 
action to no superior authority. The wage-earners 
act under their direction; have access to the equip- 
ment, plant, and machinery, without which they 
cannot support themselves, on condition of com- 
plying with the rules laid down, subject to the 
intervention of the State and of trade unions, by 
their employers; and work — and not infrequently 
live — under conditions which, consciously or un- 
consciously, the latter have determined. Hence the 
third characteristic of the economic structure of 
industrial societies is the sharpness of the division 
between the upper and lower grades of the economic 
hierarchy. In the concentration of authority which 
springs from the separation of the functions of 



6o INEQUALITY AND SOCIAL STRUCTURE 

initiative and control on the one hand, and of 
execution on the other, such societies resemble a 
pyramid with steeply sloping sides and an acute 
apex. 

In the course of the last two generations that 
concentration of authority has passed into a new 
and more sensational stage. In the infancy of the 
great industry its significance was veiled by the 
multitude of small undertakings and the absence 
of combination between them, by the general 
belief that, with luck and perseverance, any able 
man could fight his way to the top, and by the 
fact that, since the employer was normally an 
individual, not a company, the relations between 
management and wage-earners, if often harsher 
than to-day, were also less remote and impersonal. 
In certain branches of industry and in certain com- 
munities such conditions still survive, but the 
current has obviously been flowing for two genera- 
tions in the opposite direction. It is sometimes 
suggested that the growth of joint-stock enterprise, 
by increasing the number of small investors, has 
broadened the basis of industrial government. But, 
if joint-stock enterprise has done something to 
diffuse ownership, it has centralized control. The 
growth in the size of the business unit necessarily 
accelerates the process by which ever larger bodies 
of wage-earners are brigaded under the direction of 
a comparatively small staff of entrepreneurs. The 
movement towards combination and amalgamation, 
which is advancing so rapidly to-day in Great 
Britain, does the same. The emergence, side by side 
with questions of wages and working conditions, 
of questions of status and control is one symptom 
of the more definite horizontal cleavage which that 



THE ECONOMIC AND SOCIAL CONTOURS 6i 

centralization of economic command has tended to 
produce. 


So, when English society is considered as a series 
of groups engaged in production, the salient charac- 
teristic of its class structure is the division between 
the majority who work for wages, but who do not 
own or direct, and the minority who own the 
material apparatus of industry and determine 
industrial organization and policy. Society is not 
merely, however, an economic mechanism in which 
different groups combine for the purpose of pro- 
duction; it is also a system of social groups with 
varying standards of expenditure and habits of life, 
and different positions, not only on an economic, 
but on a social, scale. It has, therefore, a social, as 
well as an economic, pattern. And, though the first 
is moulded upon the second, it has also a character 
and logic of its own, which find expression in 
distinctive forms of organization and give rise to 
separate and peculiar problems. 

Regarded from the standpoint, not of the produc- 
tion of wealth, but of its use and consumption, the 
predominant characteristic of the English social 
system is simple. It is its hierarchical quality, and 
the connection of that quality with differences of 
wealth. All forms of social organization are hier- 
archical, in the sense that they imply gradations of 
responsibility and power, which vary from individual 
to individual according to his place in the system. 
But these gradations may be based on differences of 
function and office, may relate only to those aspects 
of life which are relevant to such differences, and 
may be compatible with the easy movement of 



62 INEQUALITY AND SOCIAL STRUCTURE 

individuals, according to their capacity, from one 
point on the scale to another. Or they may have 
their source in differences of birth, or wealth, or 
social position, may embrace all sides of life, including 
the satisfaction of the elementary human needs 
which are common to men as men, and may corres- 
pond to distinctions, not of capacity, but of 
circumstance and opportunity. 

It is possible to conceive a community in which 
the necessary diversity of economic functions existed 
side by side with a large measure of economic and 
social equality. In such a community, while the 
occupations and incomes of individuals varied, 
they would live, nevertheless, in much the same 
environment, would enjoy similar standards of 
health and education, would find different positions, 
according to their varying abilities, equally accessible 
to them, would intermarry freely with each other, 
would be equally immune from the more degrading 
forms of poverty, and equally secure against 
economic oppression. But the historical structure 
and spirit of English society are of a different 
character. It has inherited and preserved a tradition 
of differentiation, not merely by economic function, 
but by wealth and status, and that tradition, 
though obviously weakened during the last two 
generations, has left a deep imprint both on its 
practical organization and on its temper and habits 
of thought. Thus not only is it, like all social 
systems, a pyramid, but it is a pyramid the successive 
tiers of which tend to correspond only to a small 
degree with differences of character and ability, 
and to a high degree with differences of social class. 
Not only is it a hierarchy, but it is a hierarchy whose 
gradations embrace those aspects of life where 



THE ECONOMIC AND SOCIAL CONTOURS 63 

discrimination is inappropriate, because it ignores 
the common element in human requirements, as 
well as those where, because it is related to varying 
levels of human capacity, it is appropriate and 
necessary. It is marked, in short, by sharp differences, 
not only of economic status and economic power, 
but of pecuniary income, of circumstances, and of 
opportunity. 

The distribution of pecuniary income in Great 
Britain has often been analysed. Professor Bowley 
has estimated that, in 1910, just over i per cent, 
of the population took 30 per cent., and 5i per cent, 
took 44 per cent., of the national income, leaving 
70 per cent, of the income to 98*9 per cent, of the 
population, and 56 per cent, of the income to 
94^ per cent, of the population. Sir Josiah Stamp 
has stated that in 1919 ^‘one-twelfth of the gross 
total income was received by about one-48oth of 
the people and one-half by approximately one- 
ninth to one-tenth of the people’\ Later investiga- 
tions show much the same result. “Speaking of the 
years 1929 or 1935”, writes Mr, Colin Clark, “we 
can say that one-tenth of the whole working 
population, with incomes over £ 2 ^ 0 ^ took 42 per 
cent, of the whole total of personal incomes, or 
just over one-half if we allow for the fact that the 
greater part of the non-personal incomes, in the 
form of undistributed company profits and such, 
accrued for the benefit of the rich. A small class, 
comprising li per cent, of the population, with 
‘four-figure’ incomes and upwards, took 23 per cent, 
of the whole total of personal incomes.”’^ The 
average income per person in the richest class, with 
incomes of over ^10,000 each, was actually over 
220 times that per person in the poorest class. 



64 INEQUALITY AND SOCIAL STRUCTURE 

embracing i i, 8 oo receivers of incomes of under £ 12 ^. 

Income, it will be noted, is somewhat less un- 
equally distributed than capital; but the steepness 
of the slope which such figures reveal is, it will 
be agreed, extraordinary. Pecuniary income, how- 
ever, is not the only factor which requires to be 
taken into account in considering the gradations 
of the class system. For the distribution of income, 
as set out by the statisticians, may be subsequently 
altered by taxation and by expenditure on social 
services, and thus a high degree of inequality of 
pecuniary income may co-exist, as far, at least, as 
certain sides of life are concerned, with a considerable 
measure of practical equality. Such practical equality 
— though, thanks to such measures, slightly less 
remote than it was — is still very far, nevertheless, 
from having been approached. Hence, not only are 
there the oft-cited disparities of financial resources, 
which are susceptible of statistical measurement, 
but, what is more fundamental, education, health, 
the opportunities for personal culture and even 
decency, and sometimes, it would seem, life itself, 
tend to be meted out on a graduated scale. The 
destiny of the individual is decided, to an extent 
which is somewhat less, indeed, than in the past, 
but which remains revolting, not by his personal 
quality, but by his place in the social system, by 
his position as a member of this stratum or of that. 

These contrasts of circumstances are more power- 
ful as an instrument of social stratification even than 
the differences of income of which they are the 
consequence. Most infants, high medical authorities 
inform us, are born healthy, but of the children — 
predominantly, of course, the children of wage- 
earners — ^who enter the elementary schools at the 



THE ECONOMIC AND SOCIAL CONTOURS 65 

age of five, no less than one-fifth are found to be 
suffering from physical defects which cripple their 
development and sow the seeds of illness in later 
years. When their formal education begins, they 
find in the elementary schools, with all the immense 
improvement that has taken place in those schools 
in the course of the last generation, conditions of 
accommodation, equipment and staffing which 
would not be tolerated for an instant in the schools 
attended by the well-to-do, and which are excluded, 
indeed, from grant-aided secondary schools by the 
regulations of the Board of Education. While 
the provision for the earlier stages of education is 
defective in quality, the provision for the later stages 
is defective in quantity. Educational considerations 
— considerations of the conditions most likely to pro- 
mote the growth of human beings in physique and 
intelligence — dictate, as has often been pointed out, 
that all normal children shall pass from primary 
education to some form of secondary education. 
But the proportion of children leaving the elemen- 
tary schools who enter what have hitherto been 
known as secondary schools is, in England and Wales 
as a whole, less than one-seventh, and in some areas 
less than one-tenth, while some three-quarters of 
them have hitherto entered full-time wage-earning 
employment at the age of fourteen. 

Thus, even in childhood, different strata of the 
population are distinguished by sharp contrasts of 
environment, of health, and of physical well-being. 
A small minority enjoy conditions which are 
favourable to health, and receive prolonged and 
careful nurture, and are encouraged to regard 
themselves as belonging to a social group which 
will exercise responsibility and direction. The great 



66 INEQUALITY AND SOCIAL STRUCTURE 

majority are exposed to conditions in which health, 
if not impossible, is necessarily precarious, and end 
their education just at the age when their powers 
are beginning to develop, and are still sometimes 
encouraged to believe that the qualities most 
desirable in common men are docility, and a respect 
for their betters, and a habit of submission. As the 
rising generation steps year by year into industry, 
it enters a world where these social contrasts are 
reinforced by economic contrasts — by the differences 
of security and economic power which distinguish 
those who own property and control the industrial 
machine from those who are dependent on their 
daily labour and execute the routine work of the 
economic system. But the social contrasts continue, 
and are, indeed, intensified. In spite of the poets, 
there are no such inveterate respecters of persons as 
disease and death, and the disparities find expression 
in the difference between the liability to disease and 
death of impoverished and well-to-do areas — in the 
fact, for example, that in the less densely populated 
parts of Manchester the death-rate a decade ago was 
I0'5 per 1,000, and in the more densely populated 
parts 1 6, and that in a poor district of Glasgow it was 
approximately twice what it was where 'poverty 
was less. More recent investigations underline 
the same point. It has been shown — to quote only 
one example — that in Stockton-on-Tees the stan- 
dardised death-rate during the years 1931-34 was 
11*5 per 1,000 for the better-off families, and more 
than twice as much — 26 per 1,000 — for the poorest.® 
The poor, it seems, are beloved by the gods, if not 
by their fellow-mortals. They are awarded excep- 
tional opportunities of dying young. 

A stratified class system appears, therefore, to 



THE ECONOMIC AND SOCIAL CONTOURS 67 

have as its second characteristic the contrast 
described in the familiar phrase of Disraeli, the 
contrast not only between different levels of 
pecuniary income, but between different standards 
of physical well-being and different opportunities 
for mental development and civilization. And it 
has, in addition, a third symptom, which is little 
less significant than these, and which is more 
conspicuous, perhaps, in England than in some 
other countries, for example the United States, 
where inequality of income is hardly less pronounced. 
It is the general, and, till recently, the almost un- 
questioning, acceptance of habits and institutions, 
which vest in particular classes a special degree of 
public influence and an exceptional measure of 
economic opportunity. 

The association of political leadership with birth 
and wealth is a commonplace of English history; 
but it is not always realized how little that asso- 
ciation was weakened after the advent of what is 
usually regarded as the age of democracy. Professor 
Laski, in his instructive analysis of the personnel 
of British Cabinets between l8oi and 1924, has 
shown that, for nearly two generations after the 
Act of 1867 had enfranchised the urban working 
classes, the greater part of the business of govern- 
ment continued, nevertheless, to be conducted by a 
small group of owners of great properties, who were 
enabled by their economic advantages and social 
connections to step into the exercise of political 
power with a facility impossible to ordinary men. 
Of 69 Ministers who held office between 1885 and 
1905, 40 were the sons of nobility, 52 were educated 
at Oxford and Cambridge, and 46 were educated 
at public schools; while, even between 1906 and 



68 INEQUALITY AND SOCIAL STRUCTURE 

1916, 25 out of 51 Ministers were sons of nobility.® 
To turn from these figures to the prognostications 
of catastrophic social changes advanced in 1832 
and 1867 is to receive a lesson in the vanity of 
political prophecies. Of all the institutions changed 
by the advent of political democracy, the tradi- 
tional system of government by a small knot of rich 
families was for half a century that which changed 
the least. They heard the rumblings of the demo- 
cratic tumbril, but, like the patient East, 

They let the legions thunder past, 

And plunged in thought again, 

or, if not in thought, in whatever substitute for it 
they found more congenial. 

The political phenomenon described by Professor 
Laski is to-day no longer so conspicuous as it was. 
But the forces which for long made political leader- 
ship so largely dependent upon the peculiar oppor- 
tunities opened by birth and wealth have left their 
mark, as was to be expected, upon other departments 
of English life. They have tended to produce, in 
them also, a similar, though somewhat less noticeable, 
restriction of leadership to particular classes, with 
special opportunities and connections, which is 
only gradually being undermined by the wider 
educational provision that has been made since 1902. 

‘‘If one could not be Eton and Oxford,” writes 
Mr. Algernon Cecil of the middle of last century, 
“one did well in those days to be Harrow and 
Cambridge”. The evidence presented by Mr. 
Nightingale, who has made a statistical analysis of the 
social antecedents of the personnel of the Foreign 
Office and Diplomatic Service between 1851 and 
1929, suggests that his statement is true of a more 



THE ECONOMIC AND SOCIAL CONTOURS 69 

recent period. Sixty per cent, of it, he shows, has 
been drawn from the eleven most exclusive public 
schools, while, of the remaining forty per cent., well 
over one-half attended the lesser public schools, 
received a military or naval education, or were 
educated privately or abroad. “The unchallengeable 
conclusion that emerges ... is that the British 
Foreign Office and Diplomatic Service has been 
a preserve for the sons of the aristocratic, rentier 
and professional classes. . . . The general inference 
which follows from a study of the effects of the 
various reforms in the examination regulations is 
that they have been substantial but not profound.” 
Professor Ginsberg, who has recently investigated 
the antecedents of 1,268 British subjects admitted 
to Lincoln’s Inn at different periods between 1886 
and 1927, reaches a somewhat similar conclusion 
with regard to the recruitment of one section of the 
legal profession. Over 75 per cent, of them belonged, 
he finds, to the group classified by the census as 
“upper and middle”, while in no period did the sons 
of wage-earners amount to i per cent, of the total 
admissions, except in the years 1923-7, when they 
formed i*8 per cent, of them.^® 

No adequate statistics are available of the classes 
from which other professions are recruited, and 
conclusions must necessarily, therefore, be tentative 
and provisional. But some indirect light is thrown 
upon the subject by an examination of the educa- 
tional careers of those by whom positions of 
eminence in the professional world are at present 
occupied. The results of such an examination are 
set out in the Table printed in Appendix I. 
It will be seen that in the year 1926, 71 out of 80 
bishops and deans for whom information is available. 



70 INEQUALITY AND SOCIAL STRUCTURE 

139 out of 1 81 members of the judicial profession, 
152 out of 210 highly placed members of public 
departments, 63 out of 88 members of the Indian 
Civil Service and Governors of Dominions, and 99 
out of 132 directors of banks and railways, had been 
educated at public schools. The more select ‘^public” 
schools appear to have a special attraction for the 
clergy and for directors of companies. Of the 80 
deans and bishops, 51, and, of the 132 directors of 
banks and railways, 85, were educated at the four- 
teen most celebrated among them, while, of the 
whole 691, the number so educated was 330, or 47 
per cent.^ Even if it be assumed that all those for 
whom information is not available were educated at 
schools of other kinds, the high proportion educated 
at public schools remains striking. It will be realized, 
of course, that, since persons now eminent were 
educated between twenty-five and fifty years ago, 
such figures reflect the conditions prevailing in the 
last two decades of the nineteenth century rather 
than those of to-day. It is significant, however, that, 
even from 1924 to 1929, 64 per cent, of the successful 
candidates for the administrative grade of the 
Civil Service still came, according to the evidence 
submitted to the Royal Commission, from 150 
schools belonging to the Headmasters’ Conference.^^ 
‘‘The philosophy of the boarding-school”, writes 
Mr. R. F. Cholmeley, “is, on the whole, a philosophy 
of the well-to-do”, who “look out upon life from^ a 
fortress”, and another distinguished headmaster, 
contrasting the English educational dualism with 
the arrangements of France and Germany, where 
“rich and poor are educated side by side”, has 
observed that “the public school is a school for 
the well-to-do” There are, no doubt, certain 



THE ECONOMIC AND SOCIAL CONTOURS 71 

public schools, for example Christ’s Hospital, which 
are attended by a considerable number of boys from 
elementary schools. But it is true, nevertheless, to 
say that the public schools, and, in particular, the 
most celebrated among them, are traditionally 
connected with the middle and upper classes, and, 
with certain conspicuous exceptions, are but rarely 
attended by the children of wage-earners. Drawing 
their pupils mainly, not from the public primary 
schools, but from the so-called preparatory schools, 
and catering for the requirements of the wealthier 
sections of the community, they form virtually a 
closed educational system of their own, side by side 
with the system of public education which has as its 
foundation the elementary school. They are even 
disposed, it seems, not to deny their isolation, but 
to be proud of it, and to suppose, as was recently 
explained by the governors of one of them, which 
had the misfortune, till the error was corrected, to 
be attended by an unusually large number of boys 
from elementary schools, that their character as 
public schools will somehow be impaired, if too 
many of such children are admitted to them. A 
public school, in short, is not a school that is easily 
accessible to the public, but a school that the great 
majority of the public are precluded from entering. 

(iii) 

Equality and Culture 

Since life is a swallow, and theory a snail, it is not 
surprising that varieties of class organization should 
be but inadequately represented in the terminology 
of political science. But the absence of a word to 



72 INEQUALITY AND SOCIAL STRUCTURE 

describe the type of society which combines the 
forms of political democracy with sharp economic 
and social divisions is, none the less, unfortunate, 
since it obscures the practical realities which it is 
essential to grasp. The conventional classification 
of communities by the character of their constitu- 
tional arrangements had its utility in an age when 
the principal objective of effort and speculation 
was the extension of political rights. It is economic 
and social forces, however, which are most influen- 
tial in determining the practical operation of 
political institutions, and it is economic and social 
relations that create the most urgent of the internal 
problems confronting industrial communities. The 
most significant differences distinguishing different 
societies from each other are, in short, not 
different forms of constitution and government, but 
different types of economic and social structure. 

Of such distinctions the most fundamental is 
that which divides communities where economic 
initiative is widely diffused, and class differences 
small in dimensions and trivial in their effects, 
from those where the conditions obtaining are the 
opposite — ^where the mass of mankind exercise 
little influence on the direction of economic enter- 
prise, and where economic and cultural gradations 
descend precipitately from one stratum of the 
population to another. Both types may possess 
representative institutions, a wide franchise, and 
responsible government; and both, therefore, may 
properly be described as democracies. But to regard 
them as, on that account, resembling each other — 
to ignore the profound differences of spirit and 
quality between a democracy in which class divisions 
play a comparatively unimportant part in the life 



EQUALITY AND CULTURE 


73 


of society, and a democracy where the influence of 
such differences is all-pervasive — is to do violence 
to realities. It is like supposing that all mammals 
have the same anatomical structure, or that the 
scenery of England resembles that of Switzerland 
because both countries lie in the temperate zone. 
Such varieties should be treated by political scientists 
as separate species, and should be given distinctive 
names. The former contain large elements, not 
merely of political, but of social, democracy. The 
latter are political democracies, but social oligarchies. 

Social oligarchies have existed under widely 
divergent material circumstances, and in the most 
sharply contrasted conditions of economic civiliza- 
tion. In the past they were specially associated 
with the feudal organization of agricultural societies, 
so that, in the infancy of the modern economic world, 
the expansion of commerce and manufacture was 
hailed, by some with delight, by others with appre- 
hension, as the acid which would dissolve them. 
To-day, since in most parts of Europe the peasant 
farmer has come to his own, it is highly industrialized 
communities that are their favourite stronghold. 
Though it is in countries such as England and 
Germany, where the great industry flowed into the 
moulds prepared by an aristocratic tradition, that 
they attain their full efflorescence, they do not only 
conform to an old tradition of aristocracy, they also 
themselves create a new tradition. They appear to 
be the form of social organization which, in the 
absence of counteracting measures, the great industry 
itself tends spontaneously to produce, when its 
first outburst of juvenile energy is over, when 
its individualistic, levelling and destructive phase 
has given place to that of system and organization. 



74 INEQUALITY AND SOCIAL STRUCTURE 

The most instructive illustration of that tendency 
is given by the history of industrial America, because 
it is in America that its operation has been at once 
swiftest and least anticipated. The United States 
started on its dazzling career as nearly in a state 
of innocence as a society can. It had no medieval 
past to bury. It was free from the complicated 
iniquities of feudal land-law and the European 
class system. It began, at least in the north, as a 
society of small farmers, merchants, and master- 
craftsmen, without either a large wage-earning pro- 
letariat or the remnants of serfdom which lingered 
in Europe till a century ago. It believed that all 
men have an equal right to life, liberty, and the 
pursuit of happiness. The confident hope that it 
would be unsullied by the disparities of power and 
wealth which corrupted Europe was the inspiration 
of those who, like Jefferson, saw in the Revolution, 
not merely the birth of a new state, but the dawn 
of a happier society. 

It is the genuine, if partial, realization of that 
hope, in certain parts, at least, of America, which has 
made it for a century the magnet of Europe, and 
which still gives to American life much of its charm. 
It is marked, indeed, by much economic inequality; 
but it is also marked by much social equality, which 
is the legacy from an earlier phase of its economic 
civilization — though how long it will survive in the 
conditions of to-day is a different question, on which 
Americans themselves sometimes speak with appre- 
hension. But evidently it is not in the America of 
which Englishmen hear most, but in that of which 
they hear least, not in the America of Wall Street 
and Pittsburg and the United States Steel Corpora- 
tion and Mr. Morgan and Mr. Ford, but in the 



EQUALITY AND CULTURE 


75 


America of the farmer and the country town and 
the Middle West, that this charm is to-day most 
likely to be found. And evidently the equality of 
manners and freedom from certain conventional 
restraints, to which, partly at least, it is due, exist, 
not because of the industrial expansion of America, 
but in spite of it. 

Nearly a century ago, De Tocqueville, who wrote 
on the first page of his De la Democratie en Amerique 
that the general equality of conditions in America 
was the fundamental fact from which all others 
seemed to be derived, gave to one of his later chap- 
ters the significant title, ‘‘How aristocracy may be 
engendered by manufactures”. “If ever”, he wrote, 
“a permanent inequality of conditions and aris- 
tocracy again penetrate into the world, it may be 
predicted that this is the gate by which they will 
enter” Americans have led the world in the 
frequency and fullness of their official inquiries 
into economic organization, and, if the results of 
such inquiries may be trusted, that prophecy, as 
far as industrial America is concerned, is to-day 
not far from fulfilment. And what is true of the 
great industry in the United States is not less true 
of other industrial communities. Their natural ten- 
dency, it seems, except in so far as it is qualified 
and held in check by other forces, is to produce the 
concentration of economic power, and the inequali- 
ties of circumstance and condition, which De 
Tocqueville noted as the mark of an aristocratic 
social order. 

A right to the pursuit of happiness is not identical 
with the right to attain it, and to state the fact is 
not to pronounce a judgment upon it. To see in 
economic concentration and social stratification the 



76 INEQUALITY AND SOCIAL STRUCTURE 

mystery of iniquity and the mark of the beast, to 
regard as the result of a deliberate and sinister 
conspiracy qualities which are the result partly of 
a failure to control impersonal forces, partly, not 
of a subtle and unscrupulous intelligence, but 
of its opposite — of a crude appetite for money and 
power among the few, and a reverence for success in 
obtaining them among the many — ^would, no doubt, 
be naive. Yes, but how irrational also to suppose, 
as in England it is much commoner to suppose, 
that such characteristics are anything but a mis- 
fortune which an intelligent community will do 
all in its power to remove! How absurd to regard 
them as inevitable and admirable, to invest them 
with a halo of respectful admiration, and to deplore, 
whenever their economic foundations are threatened, 
the crumbling of civilization and the Goth at the 
gate! A nation is not civilized because a handful 
of its members are successful in acquiring large 
sums of money and in persuading their fellows 
that a catastrophe will occur if they do not acquire 
it, any more than Dahomey was civilized because 
its king had a golden stool and an army of slaves, 
or Judea because Solomon possessed a thousand 
wives and imported apes and peacocks, and sur- 
rounded the worship of Moloch and Ashtaroth 
with an impressive ritual. 

What matters to a society is less what it owns 
than what it is and how it uses its possessions. It 
is civilized in so far as its conduct is guided by a 
just appreciation of spiritual ends, in so far as it 
uses its material resources to promote the dignity 
and refinement of the individual human beings 
who compose it. Violent contrasts of wealth and 
power, and an undiscriminating devotion to insti- 



EQUALITY AND CULTURE 


77 


tutions by which such contrasts are maintained and 
heightened, do not promote the attainment of such 
ends, but thwart it. They are, therefore, a mark, 
not of civilization, but of barbarism, like the gold 
rings in the noses of savage monarchs, or the 
diamonds on their wives and the chains on their 
slaves. Since it is obviously such contrasts which 
determine the grounds upon which social struggles 
take place, and marshal the combatants who engage 
in them, they are a malady to be cured and a problem 
which demands solution. 


But are they a malady? Granted, it is sometimes 
retorted, that sharp economic distinctions, with the 
complacency and callousness which such distinctions 
produce, are in themselves nauseous, are they not, 
nevertheless, the safeguard for virtues that would 
perish without them? Is not even the attachment 
of Englishmen to the idea of class, vulgar and 
repulsive as are many of its manifestations, the 
lantern which shelters a spark that, but for its 
protection, would be extinguished or dimmed? 

The characteristics of a civilized society, Mr. Bell 
has argued in his entertaining book/® are reasonable- 
ness and a sense of values, and these qualities were 
made possible in the ages in which, by general 
consent, they found their supreme and imperish- 
able expression, because they had as their vehicle 
an elite — an elite which was released for the life of 
the spirit by the patient labour of slaves and peasants. 
What was true of the Athens of Pericles, and the 
Italy of the Renaissance, and the France of Voltaire, 
is true, in a humbler measure, of every society 
which is sufficiently mature to understand that 



78 INEQUALITY AND SOCIAL STRUCTURE 

freedom and intellectual energy are more vital to 
its welfare than the mechanical satisfaction of its 
material requirements. If it is to possess, not 
merely the comforts, but the graces, of existence, 
it must be enamoured of excellence. It must erect 
a standard of perfection, and preserve it inviolate 
against the clamour for the commonplace which 
is the appetite of the natural man, and of his eager 
hierophant, the practical reformer. But a standard 
of perfection, it is urged, is the achievement of a 
minority, and inequality is the hedge which protects 
it. It is the sacred grove which guards the shrine 
against the hooves of the multitude. Like an oasis 
which few can inhabit, but the very thought of 
which brings refreshment and hope to the sand- 
weary traveller, inequality, it is argued, protects 
the graces of life from being submerged beneath 
the dust of its daily necessities. It perpetuates a 
tradition of culture, by ensuring the survival of a 
class which is its visible embodiment, and which 
maintains that tradition in maintaining itself. 

Compared with the formidable host which under- 
stands by civilization the elaboration of the apparatus 
and machinery of existence, as though Athens, or 
Florence, or Elizabethan England were objects of 
respectful pity when set side by side with modern 
London or New York, those who press such con- 
siderations are clearly on the side of light. If the 
Kingdom of Heaven is not eating and drinking, 
but righteousness and peace, neither is civilization 
the multiplication of motor-cars and cinemas, or 
of any other of the innumerable devices by which 
men accumulate means of ever-increasing intricacy 
to the attainment of ends which are not worth 
attaining. It is true that the mark of civilization 



EQUALITY AND CULTURE 


79 


is the respect for excellence in the things of the 
spirit, and a readiness to incur sacrifice for the sake 
of fostering it. It is true that excellence is im- 
possible in the absence of severe and exacting 
standards of attainment and appreciation which 
check the taste for cheap success and shoddy 
achievement by cultivating a temper which dis- 
criminates ruthlessly between the admirable and the 
second-rate. It is true that such a temper has no 
more persistent or insidious foe than the perversion 
of values, which confuses the ends of life with the 
means, and elevates material prosperity, whether 
the interpretation put upon it is the accumulation 
of wealth or the diffusion of comfort, from the 
position of secondary and instrumental importance 
that properly belongs to it, into the grand and 
overmastering object of individual effort and public 
approval. 

In order, however, to escape from one illusion, 
it ought not to be necessary to embrace another. If 
civilization is not the product of the kitchen garden, 
neither is it an exotic to be grown in a hot-house. 
Its flowers may be delicate, but its trunk must be 
robust, and the height to which it grows depends on 
the hold of its roots on the surrounding soil. Culture 
may be fastidious, but fastidiousness is not culture; 
and, though vulgarity is an enemy to “reasonableness 
and a sense of values’% it is less deadly an enemy than 
gentility and complacency. A cloistered and se- 
cluded refinement, intolerant of the heat and dust 
of creative effort, is the note, not of civilization, 
but of the epochs which have despaired of it — ^which 
have seen, in one form or another, the triumph of 
the barbarian, and have sought compensation for 
defeat in writing cultured footnotes to the master- 

D 



8o INEQUALITY AND SOCIAL STRUCTURE 

pieces they are incapable of producing. Its achieve- 
ments may be admirable, but they are those of a 
silver age, not of a golden. The spiritual home of 
its votaries is not the Athens of Sophocles; it is 
the Alexandria of the scholiasts and the Rome of 
Claudian. 

Clever men, it has been remarked, are impressed 
by their difference from their fellows; wise men are 
conscious of their resemblance to them. It would be 
ungracious to suggest that such an attitude is a 
mark rather of cleverness than of wisdom, but it is 
not wholly free from the spirit of the sect. When 
those who adopt it fall below themselves, when 
they relapse into glorifying what Bacon calls the 
idola specus^ they are liable to rhapsodize over 
civilization in the tone of a Muggletonian dispensing 
damnation to all but Muggletonians, as though its 
secret consisted in the fact that only a select 
minority is capable of enjoying it, as though it 
were a species of private entertainment to which a 
coterie of the right people had received an exclusive 
invitation. 

What their error is they could learn from the 
great ages which they rightly admire. Neither of 
them, indeed, was quite the epicure’s banquet which 
they are sometimes thought to have been. Athens, 
in its greatest days, like Florence in the fourteenth 
and fifteenth centuries, was a bustling commercial 
city, with an almost arrogant patriotism and a 
zest for politics which often found expression' in 
crude and violent action. It was a city whose special 
boast was that it touched with its magic, not only, 
like its great rival, an elite, but common men. Its 
policy of progressive taxation and liberal expenditure 
upon communal services roused the fury of the rich. 



EQUALITY AND CULTURE 8i 

Its poets and philosophers took public affairs with 
tragic seriousness. Its children of light had an 
incurable habit of discussing questions of art in 
terms of morality, quite like that bite noire of the 
select, the unregenerate Ruskin. 

In no age was the contact between men of letters 
and men of affairs closer than in the France of the 
eighteenth century; in no age was the stimulus to 
speculation more practical, or the influence of 
speculation upon policy more intimate and direct. 
The note of a substantial part, not only of its 
avowedly polemical writing, but of its literature 
and philosophy, was a belief in the possibility of an 
almost infinite improvement in the lot of mankind 
by the advancement of knowledge and the exercise 
of thought. It was the conviction that Reason is 
never so much herself as when she turns the weapons 
sharpened in solitude against the institutions which 
perpetuate darkness and the offenders whose 
eminence is maintained at the cost of the 
degradation of the mass of mankind. 

For there is one characteristic, not mentioned by 
the author of Civilization^ which is common to the 
thought both of Athens and of eighteenth-century 
France, and which is not the least among the sources 
of the spell which they have laid on posterity. It is 
the quality which finds its noblest expression in the 
famous speech that Thucydides puts into the mouth 
of Pericles, and of which Voltaire, who lays aside 
his work as a man of letters to denounce the remnants 
of serfdom on the Church estates, and to expose 
the judicial murders of Galas and La Barre, is the 
grand example. It is — ^to use a word that at the 
moment is sadly misused — their humanism, their 
superb sense of the dignity of man. They speak a 



iz INEQUALITY AND SOCIAL STRUCTURE 

language of permanent persuasiveness, because it 
is not that of a party or a clique, but as universal 
as reason. 

Humanism has many meanings, for human nature 
has many sides, and the attempt to appropriate it 
as the label of a sect is not felicitous. There is 
the humanism of the age which the word is most 
commonly used to describe, the humanism of 
the Renaissance, with its rediscovery of human 
achievement in art and letters. And there is the 
humanism of the eighteenth century, with its 
confidence in the new era to be opened to mankind 
by the triumphs of science, and its hatred of the 
leaden obscurantism which impeded its progress. 
There is the humanism which contrasts man with 
God, or, at least, with the God of some theologies; 
and there is the humanism which contrasts man with 
the brutes, and affirms that he is a little lower than 
the angels. These different senses of the word have 
often been at war; history is scarred, indeed, with 
the contentions between them. It ought not to be 
difficult, nevertheless, for the apostles of the one 
to understand the other; for, indignant though 
some of them would be at the suggestion, they 
are using different dialects of a common language. 
If “What a piece of work is man! how noble in 
reason! how infinite in faculty!” is the voice of 
humanism, so also is “The sabbath was made for 
man, not man for the sabbath”, and “The Kingdom 
of Heaven is within you”. Shelley’s lines. 

The loathsome mask has fallen, the man remains 
Sceptreless, free, uncircumscribed, but man. 

Equal, unclass’d, tribeless, and nationless, 

Exempt from awe, worship, degree, the king 
Over himself ; just, gentle, wise, but man. 



EQUALITY AND CULTURE 83 

are one expression of the humanist spirit. Dante’s 
‘‘Consider your origin; ye were not formed to live 
like brutes, but to follow virtue and knowledge” 
is another. 

Thus humanism is not the exclusive possession 
either of those who reject some particular body of 
religious doctrine or of those who accept it. It is, 
or it can be, the possession of both. It is not, as the 
fashion of the moment is disposed to suggest, the 
special mark of a generation which has lost its sense 
of the supernatural and is groping for a substitute. 
For, in order to be at home in this world, it is not 
sufficient, unfortunately, to disbelieve in another; 
and, in its intellectual interests, and order of life, 
and economic relations, such a generation is liable, 
in the mere innocent exuberance of its self-satis- 
faction, to display some traits, at least, which are 
not conspicuously humane. Humanism is the 
antithesis, not of theism or of Christianity — for 
how can the humanist spirit be one of indifference 
to issues that have been, for two thousand years, the 
principal concern and inspiration of a considerable 
part of humanity, or to a creed whose central 
doctrine is that God became man? — but of materi- 
alism. Its essence is simple. It is the attitude 
which judges the externals of life by their effect in 
assisting or hindering the life of the spirit. It is the 
belief that the machinery of existence — property 
and material wealth and industrial organization, 
and the whole fabric and mechanism of social 
institutions — is to be regarded as means to an end, 
and that this end is the growth towards perfection 
of individual human beings. 

The humanist spirit, like the religious spirit, is 
not, indeed, indifferent to these things, which, on 



84 INEQUALITY AND SOCIAL STRUCTURE 

their own plane, are obviously important; but it 
resists their encroachment upon spheres which do 
not belong to them. It insists that they are not the 
objects of life, but its instruments, which are to be 
maintained when they are serviceable, and changed 
when they are not. Its aim is to liberate and cultivate 
the powers which make for energy and refinement; 
and it is critical, therefore, of all forms of organiza- 
tion which sacrifice spontaneity to mechanism, or 
which seek, whether in the name of economic 
efficiency or of social equality, to reduce the variety 
of individual character and genius to a drab and 
monotonous uniformity. But it desires to cultivate 
these powers in all men, not only in a few. Resting, 
as it does, on the faith that the differences between 
men are less important and fundamental than their 
common humanity, it is the enemy of arbitrary and 
capricious divisions between different members of 
the human family, which are based, not upon what 
men, given suitable conditions, are capable of 
becoming, but on external distinctions between 
them, such as those created by birth or wealth. 

Sharp contrasts of opportunity and circumstance, 
which deprive some classes of the means of develop- 
ment deemed essential for others, are sometimes 
defended on the ground that the result of abolishing 
them must be to produce, in the conventional 
phrase, a dead-level of mediocrity. Mediocrity, 
whether found in the valleys of society or, as not 
infrequently happens, among the peaks and emi- 
nences, is always to be deprecated, though it is 
hardly curable, perhaps, as sometimes seems to be 
supposed, by so simple a process as the application 
to conspicuous portions of the social system of 
sporadic dabs of varnish and gilt. But not all the 



EQUALITY AND CULTURE 85 

ghosts which clothe themselves in metaphors are 
equally substantial, and whether a level is regrettable 
or not depends, after all, upon what is levelled. 

Those who dread a dead-level of income or wealth, 
which is not at the moment a very pressing danger 
in England, do not dread, it seems, a dead-level 
of law and order, and of security for life and property. 
They do not complain that persons endowed by 
nature with unusual qualitities of strength, audacity 
or cunning are artificially prevented from breaking 
into houses, or terrorizing their neighbours, or 
forging cheques. On the contrary, they maintain a 
system of police in order to ensure that powers of 
this kind are, as far as may be, reduced to impotence. 
They insist on establishing a dead-level in these 
matters, because they know that, by preventing the 
strong from using their strength to oppress the 
weak, and the unscrupulous from profiting by their 
cleverness to cheat the simple, they are not crippling 
the development of personality, but assisting it. 
They do not ignore the importance of maintaining 
a high standard of effort and achievement. On the 
contrary, they deprive certain kinds of achievement 
of their fruits, in order to encourage the pursuit of 
others more compatible with the improvement of 
individual character, and more conducive to the 
good of society. 

Violence and cunning are not the only forces, 
however, which hamper the individual in the 
exercise of his powers, or which cause false stan- 
dards of achievement to be substituted for true. 
There are also, in most societies, the special advan- 
tages conferred by wealth and property, and by the 
social institutions which favour them. At one time 
there has been the aristocratic spirit, which in 



86 INEQUALITY AND SOCIAL STRUCTURE 

England is now dead, with its emphasis on sub- 
ordination and the respect which is due from the 
lower orders to the higher, irrespective of whether 
the higher deserve or not to be respected. At another 
time there has been the plutocratic or commercial 
spirit, which is very much alive, with its insistence 
on the right of every individual to acquire wealth, 
and to hold what he acquires, and by means of 
it to obtain consideration for himself and power 
over his fellows, without regard to the services — 
if any — by which he acquires it or the use which he 
makes of it. 

Both have some virtues, which may have been in 
certain periods more important than their vices. 
But the tendency of both, when unchecked by other 
influences, is the same. It is to pervert the sense of 
values. It is to cause men, in the language of the Old 
Testament, “to go a-whoring after strange gods”, 
which means, in the circumstances of to-day, staring 
upwards, eyes goggling and mouths agape, at the 
antics of a third-rate Elysium, and tormenting their 
unhappy souls, or what, in such conditions, is left 
of them, with the hope of wriggling into it. It is to 
hold up to public admiration sham criteria of 
eminence, the result of accepting which is, in the 
one case, snobbery, or a mean respect for shoddy 
and unreal distinction, and, in the other case, 
materialism, or a belief that the only real forms of 
distinction are money and the advantages which 
money can buy. 

Progress depends, indeed, on a willingness on 
the part of the mass of mankind — and we all, in 
nine-tenths of our nature, belong to the mass — to 
recognize genuine superiority, and to submit 
themselves to its influence. But the condition of 



EQUALITY AND CULTURE 87 

recognizing genuine superiority is a contempt for 
unfounded pretensions to it. Where the treasure is, 
there will the heart be also, and, if men are to 
respect each other for what they are, they must 
cease to respect each other for what they own. They 
must abolish, in short, the reverence for riches, which 
is the lues Anglic ana^ the hereditary disease of the 
English nation. And, human nature being what it is, 
in order to abolish the reverence for riches, they must 
make impossible the existence of a class which is 
important merely because it is rich. 

It is not surprising, therefore, that the ages which 
were permeated most deeply with the sense of the 
dignity of man as a rational being were also ages 
which appear to have felt a somewhat slender 
respect for capricious distinctions of birth and 
fortune. It is not surprising that the temper which 
had as one of its manifestations humanisn, or the 
perfecting of the individual, should have had as 
another manifestation an outlook on society which 
sympathized with the attempt to bring the means 
of a good life within the reach of all, and regarded 
the subordination of class to class, and the arrogance 
and servility which such subordination naturally 
produces, as barbarian or gothic, as the mark of 
peoples which were incompletely civilized. It is 
in that spirit that Herodotus, speaking of the 
Athenians, who were regarded, in comparison with 
the Spartans, as dreadfully ungentlemanly, remarks 
that ‘4t is evident, not in one thing alone, but on all 
sides of life, how excellent a thing is equality 
among men”. It is in that spirit that the French 
writers of the eighteenth century, whose pernicious 
influence was denounced by Burke in the famous 
essay which George III said every gentleman should 

D* 



88 INEQUALITY AND SOCIAL STRUCTURE 

read, declared that equality, as well as liberty, must 
be the aim of the reformer. 

It is true, of course, that institutions, as always, 
fell short of the ideal. It is true that the economic 
basis of Athenian society was slavery, and that one 
result of the victory of the liberal idea in France 
was the soulless commercialism which came to its 
own in 1830. But, compared with the practice of 
the world around them, compared with Persia, or 
even with most parts of Greece in the fifth century, 
or with England and Germany in the eighteenth, 
the influence of Athens and France was felt to make 
for humanism in life and manners, as well as in 
literature and art, and against the harshness and 
brutality of traditional systems of social petrifaction. 
They not only generated light, but diffused it. 
Within the limits set by their history and environ- 
ment, it was their glory to stand for the general 
development of qualities which were prized, not 
as the monopoly of any class or profession of men, 
but as the attribute of man himself. 

Thus the testimony of history is not so wholly on 
one side as is often suggested. Whether it is practic- 
able or not to attain a large measure of equality may 
fairly be disputed; but it is not necessary, it seems, to 
be afraid of seeking it, on the ground that it is the 
enemy of culture and enlightenment. It is not 
necessary to shrink from lowering barriers of 
circumstance and opportunity, for fear that the 
quality of civilization will suffer as the radius of its 
influence is extended. It is true that civilization 
requires that there shall be free scope for activities 
which, judged by the conventional standards of the 
practical world, are useless or even pernicious, and 
which are significant precisely because they are not 



EQUALITY AND CULTURE 89 

inspired hy utilitarian motives, but spring, like the 
labour of the artist or student, from the disinter- 
ested passion for beauty or truth, or merely from the 
possession of powers the exercise of which is its 
own reward. Experience does not suggest, however, 
that in modern England the plutocracy, with its 
devotion to the maxim Privatim opulentia, publice 
egestas, is, in any special sense, the guardian of 
such activities, or that, to speak with moderation, 
it is noticeably more eager than the mass of the 
population to spend liberally on art, or education, 
or the things of the spirit. 

Nor, if the maintenance, by the institutions of 
property and inheritance, of a class of whose leisure 
these activities are the occasional by-product is 
one method of sheltering them, is it necessarily 
either the only method, or that which is most likely 
to encourage in society a temper that is keenly 
alive to their importance and disposed to make sacri- 
fices for the sake of providing opportunities for their 
further development. Culture is not an assortment 
of aesthetic sugar-plums for fastidious palates, but 
an energy of the soul. It can win no victories if it 
risks no defeats. When it feeds on itself, instead 
of drawing nourishment from the common life of 
mankind, it ceases to grow, and, when it ceases to 
grow, it ceases to live. In order that it may be, not 
merely an interesting museum specimen, but an 
active principle of intelligence and refinement, by 
which vulgarities are checked and crudities corrected, 
it is necessary, not only to preserve intact existing 
standards of excellence, and to diffuse their influence, 
but to broaden and enrich them by contact with an 
ever-widening range of emotional experiences and 
intellectual interests. The association of culture 



90 INEQUALITY AND SOCIAL STRUCTURE 

with a limited class, which is enabled by its wealth 
to carry the art of living to a high level of perfection, 
may achieve the first, but it cannot, by itself, achieve 
the second. It may refine, or appear to refine, some 
sections of a community, but it coarsens others, and 
smites, in the end, with a blight of sterility even 
refinement itself. It may preserve culture, but it 
cannot extend it; and, in the long run, it is only by 
its extension that, in the conditions of to-day, it is 
likely to be preserved. 

Thus a class system which is marked by sharp 
horizontal divisions between different social strata 
is neither, as is sometimes suggested, an indispens- 
able condition of civilization nor an edifying feature 
of it. It may, as some hold, be inevitable, like other 
misfortunes to which mankind is heir, but it is not 
lovable or admirable. It is the raw material out of 
which civilization has to be made, by bringing blind 
economic forces under rational control and sifting 
the gold of past history from its sand and sediment. 
The task of the spirit, whatever the name most 
appropriate to describe it, which seeks to permeate, 
not merely this fragment of society or that, but the 
whole community, with reason and mutual under- 
standing, is not to flatter the natural impulses which 
have their origin in the fact of class, but to purify 
and educate them. It is to foster the growth of a 
classless society by speaking frankly of the per- 
versions to which the class system gives rise and of 
the dangers which accompany them. 

The forms which such perversions assume are, 
of course, innumerable, but the most fundamental 
of them are two. They are privilege and tyranny. 
The first is the insistence by certain groups on 
the enjoyment of special advantages which are 



EQUALITY AND CULTURE 91 

convenient to themselves, but injurious to their 
neighbours. The second is the exercise of power, 
not for the common benefit, but in order that 
these special advantages may be strengthened and 
consolidated. 

It is the nature of privilege and tyranny to be 
unconscious of themselves, and to protest, when 
challenged, that their horns and hooves are not 
dangerous, as in the past, but useful and handsome 
decorations, which no self-respecting society would 
dream of dispensing with. But they are the enemies, 
nevertheless, both of individual culture and of 
social amenity. They create a spirit of domination 
and servility, which produces callousness in those 
who profit by them, and resentment in those who 
do not, and suspicion and contention in both. 
A civilized community will endeavour to exorcize 
that spirit by removing its causes. It will insist that 
one condition, at least, of its deserving the name is 
that its members shall treat each other, not as means, 
but as ends, and that institutions which stunt the 
faculties of some among them for the advantage of 
others shall be generally recognized to be barbarous 
and odious. It will aim at making power, not 
arbitrary, but responsible, and, when it finds an 
element of privilege in social institutions, it will 
seek to purge it. 



CHAPTER III 


THE HISTORICAL BACKGROUND 

Every generation regards as natural the institutions 
to which it is accustomed. Mankind, it seems, is 
more easily shocked by the unusual than by the 
shocking. Since it can rarely be induced to dis- 
tinguish between phenomena which are different 
in fact but identical in name, inequalities which are 
preventable and mischievous appear, nevertheless, 
natural, and are sheltered from attack by the 
existence of inequalities which are inevitable or 
harmless. So privilege is thought to belong to an 
age of darkness which has vanished, and the 
suggestion that it is the element of privilege in 
industrial societies which cripples their energies 
and poisons their spirit appears extravagant and 
fantastic. 


(i) 


The Fall of Legal Privilege 

It appears the more extravagant because it was the 
transformation of a society based on privilege that 
made possible the growth of industrial civilization. 
The greatest historical attack upon it was the 
liberal movement of the age between the middle of 
the eighteenth century and the middle of the 
nineteenth. It was pushed home with relentless 
energy and dauntless courage. It overthrew princi- 
palities and powers. It had its philosophers, its 
heroes, and its martyrs. It was natural that those 

92 



THE FALL OF LEGAL PRIVILEGE 


93 


to whom it opened a new world of affluence and 
power should assume that the work then done was 
done once for all. The French Revolution and the 
Industrial Revolution overturned between them the 
old forms of aristocracy in Europe. Resources so 
vast as to seem inexhaustible, free land demanding 
only men to cultivate it, the boundless horizons of 
the prairie, seemed to offer a permanent guarantee 
against the emergence of new forms of aristocracy 
in America. Together they determined that, whether 
the social inequalities of the future should be 
greater or less than those of the past, they should at 
least be different in their causes, their principles, 
and their scope. 

Privilege may be clothed in a multitude of different 
forms, and equality possesses a variety of divergent 
meanings. It is an arithmetical metaphor for a 
relation between human beings, and the interpre- 
tation to be placed on it varies from age to age, 
since it depends on the practical realities of the 
economic environment. It was the glory of the 
liberal movement, at least in France, to have poured 
its doctrines into the mould of a universal creed, 
so that the truths which it propounded were framed, 
not for Frenchmen, nox for the age of Louis XVI, 
but for men. But, if its vision embraced the whole 
world of human effort, its feet were planted on the 
solid ground of its own generation. The privilege 
which it attacked was no vague epitome of social 
injustices, but concrete and specific; the equality 
which it demanded was not a shadowy abstraction, 
but definite and precise. The former consisted of 
special economic advantages guaranteed to particular 
classes by law. The latter meant the system of class 
relations which, it was thought, would emerge. 



94 THE HISTORICAL BACKGROUND 

when the legal foundations on which these 
advantages rested had been attenuated or abolished. 

The note of the social order against which the 
attack was launched had been an inequality which 
was not accidental or temporary, but deliberate 
and systematized. Apart from the few, and usually 
inconsiderable, cities, and from exceptional regions 
where, as in Holland, the precocious development 
of commerce had created a bourgeois society, it had 
rested on the appropriation by a minority of land- 
owners of the lion’s share of the surplus wrung by 
labour from nature. Its economic foundation had 
been the subordination of the mass of cultivators 
to a social superstructure, which maintained itself 
by extracting from them part of their produce in 
the form of monetary payments, dues in kind, and 
personal services. Its legal basis had been the separa- 
tion of different strata of the population from each 
other by the existence of sharply contrasted rights 
and obligations, enforced not merely by custom or 
social influence, but by law. The social classes of the 
old regime, in most parts of the Continent, would 
more properly be described, indeed, not as classes, 
but as estates, within which there might be profound 
disparities of income, but each of which, neverthe- 
less, was distinguished from the others by the 
presence or absence of distinctive privileges and 
peculiar powers. 

The roturier was not merely a social inferior, but 
the victim of economic disabilities imposed by law. 
The noble by inheritance or purchase did not 
merely possess a title; he was the owner of profitable 
immunities. The special characteristic of the class 
system in France and Germany had been, in fact, 
that inequality was not primarily economic, but 



THE FALL OF LEGAL PRIVILEGE 95 

juristic, and that, in spite of gross disparities of 
wealth, it rested on differences, not merely of income, 
but of legal status. Civil, not to mention political, 
rights were not identical for all men, but graded 
from class to class, and the demand of reformers for 
their equalization was repudiated by conservative 
thinkers with the same confident anticipations of 
social dissolution, were it conceded, as were aroused 
in the nineteenth century by proposals for a more 
equal distribution of wealth. Thus a single com- 
munity embraced two nations; and the nations 
consisted, not of rich and poor, or of propertied and 
propertyless, but of the legally privileged and the 
legally unprivileged. 

De Tocqueville remarked that England was the 
only country in which feudalism did not end in the 
creation of castes.^ The contrast between such a 
picture and contemporary English society was 
obviously profound. While elsewhere it needed an 
earthquake to shatter the dungeon, England, long 
before the revolutionary era had begun, had absorbed 
into her system some elements in the transformation 
which the Revolution was to produce. In a country 
whose social structure was based, not on formal 
inequalities of legal status, but on differences of 
wealth, and where estates, if they had ever existed 
in the continental sense, had long been a term of 
rhetoric rather than of law, the merchant and 
industrialist could capture the citadel without 
battering down the walls. The word bourgeois was to 
pass into continental socialism, because, on the 
Continent, it had been the designation of a definite 
class, distinct alike from the nobility and the 
peasants. In England, with its parvenu aristocracy of 
bankers, nabobs, and army contractors, it was from 



96 THE HISTORICAL BACKGROUND 

the Start almost meaningless, for the bourgeoisie 
included all strata above the manual workers. It was 
the small part played by legal privilege in English 
society which impressed continental observers, be- 
cause it was least familiar to them. It was this 
characteristic which both contributed to make 
England the pioneer of a new economic civilization, 
and determined that the gospel of equality 
trumpeted by France should wake few echoes 
across the Channel. England was immune from the 
infection of equalitarian doctrines, because she had 
already been inoculated with some of them in doses 
small enough to be harmless. 

Even in England, however, where no legal 
barriers separated different social strata, the concep- 
tion of a hierarchical social order, based on class 
domination and class subordination, was a powerful 
element in the prevalent political thought of the 
age. English society, like the English State, found 
in custom and convention an adequate substitute 
for positive enactments, and doctrines which had 
no sanction in law remained as a social influence, 
which the upper ranks used to maintain a proper 
distance between themselves and their inferiors. 
From the resplendent purple of Burke’s panegyric 
on the aristocracy — the great oaks that shade a 
country and perpetuate their benefits from genera- 
tion to generation” — to Young’s tranquil observa- 
tion, as of one enunciating a commonplace, that 
^^everyone but an idiot knows that the lower classes 
must be kept poor, or they will never be industrious”; 
from the opponent of education, who insisted that 
it would make the poor ‘‘insolent to their superiors”, 
to the apologist for education who argued that it 
would inculcate “habits of submission and respect 



THE FALL OF LEGAL PRIVILEGE 


97 


for their superiors’’, a considerable section of the 
ruling classes revered inequality as a fundamental 
article of their social faith.^ Rights might, without 
danger, be equal in name, as long as powers were 
sufficiently different in fact. Inequality, if not 
embodied in laws which assigned a different status to 
different classes, found a hardly less effective 
expression in the control by the upper orders of 
administration, in their virtual monopoly of edu- 
cational opportunity, in their exclusive exercise of 
political authority, and in the enjoyment of the 
profitable perquisites which political authority could 
be made to yield. 

In the country which launched the attack on the 
hierarchy of the past, the cry was for equality, and 
even nations which stood in arms against that 
ideal consented, though tardily and partially, to 
some, at least, of its practical applications. The 
essence of the movement was the determination to 
destroy the legal foundations of an obsolete system 
of class relations, and thus to clear a space for one 
which should be better adapted to the needs of a 
rapidly expanding society. It was one version or 
another of the conception of equality then formulated 
that later generations inherited. It was by reference 
to that conception^ — so self-evident did its adequacy 
appear — that other interpretations of the idea were 
for long dismissed as visionary or mischievous. 

In reality, however, the meaning assigned to 
equality in the eighteenth century, and the methods 
adopted for its realization, were the creation of 
the special circumstances of a particular age and 
economic environment. The form which the equali- 
tarian programme assumed in France was dictated 
by the character of the inequalities which existed. 



98 THE HISTORICAL BACKGROUND 

Since the most conspicuous of them were juristic, 
not economic, it was, in the first place, legal privilege, 
not inequality of wealth, which was the object of 
attack. A distinction was drawn between egalite 
ie droit and egalite de fait, between formal or legal 
equality and practical or economic equality. The 
primary aim of reformers was the achievement of 
the first, since, once the first was established, the 
second, in so far as it was desirable, would, it was 
thought, establish itself. It was to abolish legal 
impediments to economic enterprise, and to the 
employment by the individual of the wealth which 
his enterprise yielded. It was, in short, to create a 
democracy of property-owners who should also be 
producers. 

The measures applied for the realization of that 
ideal were the product of the conditions of French 
economic life when the Revolution took place. 
Except in Paris and Lyon, the industrial proletariat 
was small in numbers and insignificant in influence, 
and there was no consciousness that it formed a 
distinct class, with requirements of its own, whose 
condition would be the most urgent issue of the 
coming century. The burning problem was that, not 
of the propertyless wage-worker, but of the property- 
owners, and, in particular, the peasants. Since four- 
fifths of the nation lived by agriculture, it was in 
the overthrow of agrarian feudalism, with its im- 
penetrable jungle of hoary abuses, that the attack 
on privilege achieved its most sensational and most 
enduring triumphs. Since inequality appeared to 
be the result, not of individual freedom, but of the 
absence of it, the abolition of restrictions upon the 
latter seemed to be the most certain way of abolishing 
the former; and liberty and equality, which later 



THE FALL OF LEGAL PRIVILEGE 


99 


generations have sometimes held to be incompatible, 
appeared for a golden moment to walk hand in 
hand. Since the great industry was in its infancy, 
there was no suspicion that the class division of 
the future would be between capitalist and wage- 
earner, and the possibility that, when monopoly 
based on legal privilege had fallen, monopoly based 
on voluntary combination might take its place, was 
not foreseen. In a predominantly rural society, 
where the typical producer was the individual 
peasant, or craftsman, or merchant, the path to 
social justice lay, it appeared, not through organi- 
zation, but through its absence. 

It is one of the glories of the Revolution to have 
elaborated a plan of universal education, while the 
soil of the young Republic was still trampled by 
armies. The main emphasis of its doctrine, however, 
was of a different kind. It was not on the construc- 
tion of organs to aid the individual or to protect 
him against oppression, but on his emancipation 
from the legal fetters which paralysed his energies. 
To establish la carriere ouverte aux talents it was 
sufficient, it seemed, to clear the road of the barriers 
created by the vested interests of an age of darkness. 
Once restrictions on individual enterprise were 
destroyed, each man would use his powers in the 
manner most conducive both to his own interests 
and to those of his fellows, and each man would reap 
where he had sown. 

So estates disappear in a common and equal 
citizenship. All men, at least in theory, become 
equal before the law. All men pay taxes in propor- 
tion to their income, or are supposed so to pay 
them. All men may enter all occupations. All men 
may buy and sell, trade and invest, as they please. 



lOO 


THE HISTORICAL BACKGROUND 


Above all, all men may acquire property of all 
kinds. And property itself changes its nature. The 
element of sovereignty in it — such, at least, is the 
intention — ^vanishes. What remains is the right of 
exclusive disposal over marketable commodities. 

In such a society, it was argued, inequalities of 
wealth between individuals would remain, but 
they would have lost their sting. For inequalities 
between classes would have disappeared with the 
disappearance of the legal privileges which had 
created and perpetuated them, and the solvent of 
social stratification would have been found in 
economic freedom. The true meaning of equality, 
in short, is uniformity of legal rights. In this sense, 
and this sense alone, is it proper to seek, or possible 
to attain, it. To the enrages who went further, and 
made the Revolution odious by clamouring for an 
agrarian law and the limitation of fortunes, short 
shrift was given. ^Tabricius in his cottage need not 
envy Crassus in his palace’’, and, apart from tem- 
porary measures of war-control, the Convention 
was hardly less merciless to the advocates of the 
equalization of wealth by measures of positive 
intervention than it was to the champions of legal 
privilege. The spectre of economic equality was 
buried with Babeuf, It was not till the revolution 
of 1848 that it emerged from its grave. 

Circumstances impose their own solutions, in 
defiance of sentiment. The loathing of other 
European governments for the levelling doctrines 
of France did not prevent them from moving, 
in a differ^jl^ «©irit, in the same direction. It was 
necessary tkc^ ^‘to do from above what the 
RevoluO^ ifcjtd done from below”, and they walked 
reluctant]^ backwards into the future, lest a worse 



THE FALL OF LEGAL PRIVILEGE loi 

thing should befall them. The overthrow of agrarian 
feudalism in France set in motion a wave which 
travelled, with gradually ebbing force, east and 
north, and the renewed energies of which have in 
our own day remade the land systems of eastern 
Europe. The French assault on the economic 
petrifaction of the old regime heralded an indi- 
vidualist movement, which emancipated economic 
initiative from monopolies, from the decaying 
remnants of the gilds, and from obsolete systems of 
state control, and which, as the revolution in 
economic technique produced its results, set the 
new aristocracy of wealth on a footing of parity with 
the old aristocracy of land. 

Nor was the attack on traditional forms of class 
stratification confined to Europe. In the first half 
of the nineteenth century the most convincing 
argument against social privilege came from America. 
The United States waged war upon it less by its 
policy than by its existence. Its weapons were the 
axe of the pioneer and the spade of the colonist. 
As American life moved its centre from the sea- 
board, where institutions were cast in a European 
mould, to form new communities in the west, its 
most significant characteristic was the rise of a 
society marked by a measure of practical equality 
unknown in Europe. 

That society was the creation, not of political 
art, but of the environment — of freedom from the 
horizontal divisions of the European social system, 
of opportunities of economic independence which 
delayed the emergence of a class of lifelong wage- 
workers, of ability to escape from economic 
oppression by advancing into regions beyond the 
reach of it, of the moving frontier whose significance 



102 


THE HISTORICAL BACKGROUND 


has been described by Professor Turner,^ of the 
pioneers to whom Whitman addresses his magnificent 
ode. Such an environment could not be other than 
temporary; but, while it lasted, it made the United 
States the classical example of what may be called, 
perhaps, natural equality, and gave an impress to 
American ideals and institutions which has survived 
its disappearance. To-day, America stands to the 
world for economic power as much as for economic 
opportunity. During the greater part of the nine- 
teenth century it stood for economic opportunity 
rather than for economic power. It was the symbol 
of a new world immune from capricious distinctions 
of class and wealth, in which the individual was 
master of his fate. 

A doctrine which implied that there was no 
difference between common men and their betters 
was obviously not one which could be entertained 
in England. The first generous impulse of sympathy 
with the Revolution was short-lived. English con- 
servative opinion in the eighteenth century watched 
the transference of property, and the levelling of 
rank and degree, in France, with somewhat the 
same horrified astonishment as it was to feel in 
the twentieth at the spectacle of Russia. Nor, in 
spite of eccentrics like Paine and Godwin, who 
preached an English version of the Rights of Man, 
were the strata who supplied the radical movement 
with its theorists and politicians much more likely 
to welcome with eagerness equalitarian doctrines, 
in the form in which such doctrines had been 
interpreted in France. Men do not burn down the 
house which they intend to occupy, even though 
they regard its existing tenant as a public nuisance. 
The characteristic features which distinguished 



THE FALL OF LEGAL PRIVILEGE 103 

the social life of England from that of France — the 
small part played by legal privilege, the public duties 
discharged by the landed gentry, the immensely 
greater importance of manufactures and commerce 
as compared with, agriculture, the fact that the small 
property-owners were declining in number while 
the wage-workers were growing — all combined 
to muffle the tones in which the middle classes 
denounced the oligarchy, lest they should prove 
too effective in exciting the populace. 

The attitude of reformers was the expression 
of the practical facts of English society. Since its 
contours were drawn by differences, not of legal 
status, but of wealth, the prosperous bourgeoisie^ 
who in France made common cause, at least for 
a time, with the strata below them, in England were 
disposed to identify themselves with those above 
them. They gratified their ambitions, not by level- 
ling the social hierarchy, but by sharing in the 
opportunities which its existence could be made to 
offer to money and success. Since the mass of the 
population were not independent producers, but 
wage-workers, the abolition of restrictions on 
economic initiative, which in France emancipated 
the nation, in England contributed, in the first 
instance at least, to an increase in the power of the 
propertied minority, by whom alone economic 
initiative could in practice be exercised. The 
aristocracy could absorb the middle classes, because 
the upper ranks of the middle classes were themselves 
an aristocracy. The bickerings between them were 
a family quarrel, not, as in France, an embittered 
class war. The admission of the latter to political 
power — the enfranchisement of ‘‘the higher and 
middling orders” — did npt overturn the social 



104 the historical BACKGROUND 

pyramid, but established it upon more stable, 
because broader, foundations. Hence, in spite of the 
radical movement, many of the characteristic 
features of the age before the deluge — the English 
land system with its great estates, the English 
village with its mixture, half-comedy, half-tragedy, 
of gentility and servility, the unearned increment of 
urban ground rents and mining royalties, swelling 
with every expansion of industrial activity, the 
virtual monopoly of ancient educational endow- 
ments by wealth and social position — survived to 
astonish foreign observers, and to falsify the 
predictions alike of the champions and of the 
opponents of political democracy. The old regime, 
it appeared, had not died; it had merely married. 
It had been transformed and rejuvenated by the 
forces released by the Industrial Revolution. 

Rejuvenation, however, is to be had only upon 
terms, and in states, as in individuals, the terms 
include a concession to the practical requirements 
of a changing world. When the social cleavage 
was so clearly between, not the noblesse and the 
nation, but the classes with property in land or 
capital and the classes without it, it was natural 
that most reformers should mention the idea of 
equality only to dissociate themselves from it. 
But, if they did not desire to destroy the edifice, 
they intended to enlarge it. If they were willing 
to leave intact large parts of the social order of 
the eighteenth century, they were none the less 
determined that a new range of interests should be 
admitted to parity side by side with the old. 

The classes floated to affluence by the new 
technique of manufacture and transport might hold 
the doctrine of the equality of men to be a ridiculous 



THE FALL OF LEGAL PRIVILEGE 105 

piece of foreign sophistry; but they regarded the 
assertion that all incomes of equal amounts deserve 
equal veneration as a self-evident truth. While 
they treated with indulgence disparities of fortune 
in the advantage of which they might hope to share, 
they were equally determined to abolish restrictions 
which favoured one kind of wealth at the expense 
of another. Hence, in the narrower range of life 
affected by it, the practical tendency of the liberal 
movement in England, in spite of its profound 
difference in spirit, was what it had been in France. 
It was to equalize legal rights by striking off privi- 
leges created, and disabilities imposed, by political 
favouritism. The extensions of the franchise and 
the reforms of local government; the abolition of 
sinecures and pensions, of the political privileges 
of the Church of England, and of the disabilities 
of Roman Catholics and Nonconformists; the 
termination of patronage in the civil service and 
of the purchase of commissions in the army, and 
the acceptance of the principle that, with certain 
exceptions, the public service should be recruited 
by open competition; the opening of schools and 
universities to persons of all shades of religious 
opinion, provided they possessed the pecuniary 
means required to take advantage of them; the 
removal of restrictions on economic enterprise, on 
trade, investment, and the use of property, and the 
establishment of limited liability; the repeal of the 
Acts which treated breach of contract by an employer 
as a civil wrong, and breach of contract by a workman 
as a criminal offence; the reduction of taxation to 
the minimum needed for defence and the preserva- 
tion of order; the refusal to contemplate the 
graduation of the income-tax and the attempt to 



io6 THE HISTORICAL BACKGROUND 

abolish it altogether; the opposition to the extension 
of public control over industry and of public 
provision for distress; the reluctance to develop the 
services concerned with health and education 
beyond the indispensable minimum — such measures 
and such omissions all hung together as parts of 
one policy. They were the logical applications of 
a coherent philosophy which reached the zenith 
of its influence between 1832 and 1870, and which, 
though later obscured behind ideas of a different 
order, is even to-day not wholly extinct. 

That philosophy was not equalitarian, for it 
reverenced birth and wealth, especially wealth. It 
was not anti-equalitarian, for it extended political 
and civil liberties, and opened doors through which 
guests whom it detested were later to pass. The main 
article in its creed had been formulated by Bentham 
when he wrote that “if the laws do not oppose it 
[equality], if they do not maintain monopolies, if 
they do not restrain trade and its exchanges, if 
they do not permit entails, large properties will 
be seen without effort, without revolutions, without 
shock, to subdivide themselves by little and little 
Its kernel was the belief that, if individual liberty 
be established, such measure of equality as is to 
be desired by wise men will, in process of time, 
establish itself. How much wise men will desire, 
being wise themselves, the philosophers did not tell. 


(ii) 


Equality of Opportunity 

A political doctrine should be judged, in the first 
place, by its strength, not by its weakness. The 



EQUALITY OF OPPORTUNITY 107 

transformation effected by the attack on legal 
privilege was beneficent and profound. It had been 
the child of economic necessity, and the impetus 
which it gave to progress in the arts which enrich 
mankind needs no emphasis. With the abolition of 
restrictions on freedom of movement, on the choice 
of occupations, and on the use of land and capital, 
imprisoned energies were released from the narrow 
walls of manor and gild and corporate town, from 
the downward pressure of class status, and from the 
heavy hand of authoritarian governments, to unite 
in new forms of association, and by means of 
them to raise the towering structure of industrial 
civilization. 

It was not only in the stimulus which it supplied 
to the mobilization of economic power that the 
movement which levelled legal privilege revealed' 
its magic. Its effect as an agent of social emancipa- 
tion was not less profound. Few principles have so 
splendid a record of humanitarian achievement. 
The monopoly of political power by corrupt and 
tyrannical minorities had everywhere been, not 
merely a practice, but an unquestioned principle 
of political organization; with the extension of 
political democracy its legal basis disappeared, and, 
if it survived as a fact, it lost the respectability of an 
institution established by law. Careers of profit and 
distinction had been reserved, as of right, to birth 
and wealth; now the barriers fell and all employ- 
ments, at least in theory, were open to all. Slavery 
and serfdom had survived the exhortations of 
the Christian Church, the reforms of enlightened 
despots, and the protests of humanitarian philo- 
sophers from Seneca to Voltaire. Before the new 
spirit, and the practical exigencies of which it 



io8 THE HISTORICAL BACKGROUND 

the expression, they disappeared, except from dark 
backwaters, in three generations. From the time 
when men first reflected on social problems, the 
social problem of Europe, tragic, insistent, and 
unsolved, had been the condition of the peasant. 
Now, at last, in most parts of the Continent, he 
came to his own. Increasingly, though by different 
methods and with varying degrees of completeness — 
by confiscation, as in France, or the division of 
estates, as in Germany, or purchase as in Ireland — 
the nineteenth century saw the end of the system 
under which the cultivator paid part of his produce 
to an absentee owner. The last chapter of the 
story which was begun in 1789 has been written in 
eastern Europe since 1918. 

Reform did not, indeed, bring him economic 
affluence, but it ended the long nightmare of legal 
oppression. It turned him from a beast of burden 
into a human being. It determined that, when 
science should be invoked to increase the output of 
the soil, its cultivator, not an absentee owner, 
should reap the fruits. The principle which released 
him he described as equality, the destruction of 
privilege, democracy, the victory of plain people. 
He understood by it, not the mathematical parity 
of pecuniary incomes, to proving the impossibility 
of which so much needless ingenuity has been 
devoted, but the end of institutions which had made 
rich men tyrants and poor men slaves. 


The movement which equalized legal rights not 
only released new productive energies, and cut down 
a forest of ancient abuses; it supplied with their 
principles the architects who built on the space that 



EQUALITY OF OPPORTUNITY 109 

it had cleared. It had not attacked all forms of 
inequality, but only those which had their roots in 
special advantages conferred on particular groups 
by custom or law. It was not intolerant of all social 
gradations, but only of such as rested on legal 
privilege. The distinctions of wealth and power 
which survived when these anomalies had been 
removed, it surrounded with a halo of intellectual 
prestige and ethical propriety. It condemned the 
inequalities of the feudal past; it blessed the in- 
equalities of the industrial future. 

The second gesture was as important as the first. 
The great industry, even in its violent youth, had 
many excellences, but the equalitarian virtues were 
not conspicuous among them. To the critics in 
France and England who urged that a new feudalism 
was arising, in which the contrasts of affluence and 
misery, of power and helplessness, were not less 
extreme than in the past, there was an easy answer. 
It was that such contrasts did, indeed, exist, but 
that they differed in principle from those which 
had preceded them. 

The inequalities of the old regime had been 
intolerable because they had been arbitrary, the 
result not of differences of personal capacity, but 
of social and political favouritism. The inequalities 
of industrial society were to be esteemed, for they 
were the expression of individual achievement or 
failure to achieve. They were twice blessed. They 
deserved moral approval, for they corresponded 
to merit. They were economically beneficial, for 
they offered a system of prizes and penalties. So it 
was possible to hate the inequalities most charac- 
teristic of the eighteenth century and to applaud 
those most characteristic of the nineteenth. The 



no 


THE HISTORICAL BACKGROUND 


distinction between them was that the former had 
their origin in social institutions, the latter in 
personal character. The fact of the equality of legal 
rights could be cited as a reason why any other 
kind of equality was unnecessary or dangerous. 

The abolition of capricious favours and arbitrary 
restrictions had enlarged the field of economic 
opportunity. The wider diffusion of economic 
opportunities secured the selection of individuals 
according to their capacities, through a social 
analogue of the biological struggle. If extreme 
inequality was the final consequence, that result 
merely meant that men’s capacities were unequal. 
Instead of the class into which he was born 
determining, as in the past, the position of the 
individual, the quality of the individual determined 
his position, and therefore his class. Refined and 
sublimated by the wholesome acid of free competi- 
tion, the word ‘‘class” itself was purged of the 
invidious associations which formerly had clung to 
it. It shed the coarse integuments of status and 
caste, and emerged as a fluid economic group, which 
all, if they pleased, were free to enter, and from 
which all, if they chose, were at liberty to escape. 
In a world where the law offered no obstacles to 
aspiring enterprise, class privilege and class tyranny 
were evidently impossible. A society marked by sharp 
disparities of wealth and power might properly, 
nevertheless, be described as classless, since it was 
open to each man to become wealthy and powerful. 

Thus the flank of the criticism of economic 
inequality was turned by the argument that it was 
the necessary result of legal equality and economic 
liberty. Rightly interpreted, equality meant, not 
the absence of violent contrasts of income and 



EQUALITY OF OPPORTUNITY iii 

condition, but equal opportunities of becoming 
unequal. It was true that few could take part in 
the competition, but no one was forbidden to enter 
for it, and no handicaps were imposed on those 
who did. To ensure that it was fair, it was sufficient, 
it was thought, to insist that the law should neither 
confer advantages nor impose disabilities. 

Most social systems need a lightning-conductor. 
The formula which supplies it to our own is equality 
of opportunity. The conception is one to which 
homage is paid to-day by all, including those 
who resist most strenuously attempts to apply it. 
But the rhetorical tribute which it receives appears 
sometimes to be paid on the understanding that it 
shall be content with ceremonial honours. It retains 
its throne, on condition that it refrains from 
meddling with the profitable business of the factory 
and market-place. Its credit is good, as long as it 
does not venture to cash its cheques. Like other 
respectable principles, it is encouraged to reign, 
provided that it does not attempt to rule. 

The content of the idea has been determined by 
its history. It was formulated as a lever to overthrow 
legal inequality and juristic privilege, and from its 
infancy it has been presented in negative, rather 
than positive, terms. It has been interpreted rather 
as freedom from restraints than as the possession of 
powers. Thus conceived, it has at once the grandeur 
and the unreality of a majestic phantom. The 
language in which it is applauded by the powers 
of this world sometimes leaves it uncertain which 
would horrify them most, the denial of the principle 
or the attempt to apply it. 

‘‘The law is just. It punishes equally the rich and 
the poor for stealing bread.” It is even generous, 

B 



tI2 


THE HISTORICAL BACKGROUND 


for it offers opportunities both to those whom the 
social system permits to seize them and to those 
whom it does not. In reality, of course, except in 
a sense which is purely formal, equality of oppor- 
tunity is not simply a matter of legal equality. Its 
existence depends, not merely on the absence of dis- 
abilities, but on the presence of abilities. It obtains 
in so far as, and only in so far as, each member 
of a community, whatever his birth, or occupation, 
or social position, possesses in fact, and not merely 
in form, equal chances of using to the full his natural 
endowments of physique, of character, and of 
intelligence. In proportion as the capacities of some 
are sterilized or stunted by their social environment, 
while those of others are favoured or pampered by 
it, equality of opportunity becomes a graceful, but 
attenuated, figment. It recedes from the world of 
reality to that of perorations. 

Mr. Keynes, in his brilliant sketch of the phase 
of economic history which ended in 1914, has seized 
on the avenues which it opened to individual 
advancement as its most striking feature. ‘‘The 
greater part of the population . . . worked hard 
and lived at a low standard of comfort. . . . 
But escape was possible, for any man of capacity 
or character at all exceeding the average, into the 
middle and upper classes.”® He is concerned with 
the set of the current, not with the breakwaters that 
dammed, or the reefs that diverted, it. In reality, 
there were then, as there are now, obstacles to the 
easy movement of ability to new positions, which 
produced individual frustration of tragic dimen- 
sions, and in our own day, of course, the movement 
towards concentration and amalgamation has made 
the independent entrepreneur, who fought his way 



EQUALITY OF OPPORTUNITY 


"3 


from poverty to wealth, a less plausible hero than 
in the age when he could be offered by moralists as a 
golden example to aspiring youth. But, as a picture 
of the ideals which ruled the nineteenth century, 
and of the qualities on which it reflected with pride 
when it had leisure for reflection, Mr. Keynes’s 
words are apt. The tendency and direction of the 
forces released by the Industrial Revolution, if that 
phrase is still to be retained, are not open to question. 
They were those described by Sir Henry Maine, 
when he wrote of “the beneficent private war 
which makes one man strive to climb on the 
shoulders of another and remain there”.* Compared 
with that of most earlier periods, the economic 
system which it created was fluid and elastic. It 
seemed the social counterpart of natural selection 
through the struggle for existence. 

So the middle classes acquiesced in sharp dis- 
tinctions of wealth and power, provided that, as 
individuals, they were free to scale the heights. 
The upper classes were glad to be reinforced by 
individuals of means and influence, who sprang 
from below, provided that, as a class, they remained 
on their eminence. They were not seriously dis- 
turbed by the spectacle of Lazarus in the House of 
Lords; for they were confident that be would behave 
like a gentleman in his new surroundings, would 
ascribe his translation to his own thrift, indepen- 
dence, and piety, would denounce the failings of 
beggars with the expert knowledge of a professional 
mendicant, would be an admirable illustration of 
the virtues of a society in which even the humblest 
could climb to ease and affluence, and would 
acquire a reputation for philanthropy for himself 
and his order by his generosity in financing supplies 



THE HISTORICAL BACKGROUND 


114 

of cold water for the economically damned. What 
neither understood nor admired, what, indeed, 
with rare exceptions, they feared and despised, 
were the aspirations that found expression, not 
merely in the claim for an open road to individual 
advancement, but in collective movements to narrow 
the space between valley and peak. 

Their welcome to individuals was conditional, 
therefore, on the latter identifying themselves with 
the sphere which they entered, not with that which 
they left. It was accompanied by a not less emphatic 
conviction of the necessity of preserving the great 
gulf fixed between Us and Them, the chasm which 
separated the elect from the mass of the population. 
This feature of the landscape had always existed, 
and it was plainly the intention of nature that it 
should continue to exist. It was an indispensable 
incentive to economic effort and moral virtue 
among the poor. It was a guarantee that the 
civilization of the rich would not be destroyed by 
its too promiscuous extension to classes incapable 
of it. 

It is possible that intelligent tadpoles reconcile 
themselves to the inconveniences of their position, 
by reflecting that, though most of them will live 
and die as tadpoles and nothing more, the more 
fortunate of the species will one day shed their tails, 
distend their mouths and stomachs, hop nimbly 
on to dry land, and croak addresses to their former 
friends on the virtues by means of which tadpoles 
of character and capacity can rise to be frogs. 
This conception of society may be described, 
perhaps, as the Tadpole Philosophy, since the con- 
solation which it offers for social evils consists in the 
statement that exceptional individuals can succeed 



EQUALITY OF OPPORTUNITY 115 

in evading them. Who has not heard it suggested 
that the presence of opportunities, by means of 
which individuals can ascend and get on, relieves 
economic contrasts of their social poison and their 
personal sting? Who has not encountered the argu- 
ment that there is an educational ‘^ladder” up which 
talent can climb, and that its existence makes the 
scamped quality of our primary education — the 
overcrowded classes, and mean surroundings, and 
absence of amenities — a matter of secondary im- 
portance? And what a view of human life such an 
attitude implies! As though opportunities for talent 
to rise could be equalized in a society where the 
circumstances surrounding it from birth are them- 
selves unequal! As though, if they could, it were 
natural and proper that the position of the mass of 
mankind should permanently be such that they can 
attain civilization only by escaping from it! As 
though the noblest use of exceptional powers were 
to scramble to shore, undeterred by the thought of 
drowning companions! 

It is true, of course, that a community must 
draw on a stream of fresh talent, in order to avoid 
stagnation, and that, unless individuals of ability 
can turn their powers to account, they are em- 
bittered by a sense of defeat and frustration. The 
existence of opportunities to move from point to 
point on an economic scale, and to mount from 
humble origins to success and affluence, is a con- 
dition, therefore, both of social well-being and of 
individual happiness, and impediments which deny 
them to some, while lavishing them on others, are 
injurious to both. But opportunities to ‘^rise’’ are 
not a substitute for a large measure of practical 
equality, nor do they make immaterial the existence 



ii6 THE HISTORICAL BACKGROUND 

of sharp disparities of income and social condition. 
On the contrary, it is only the presence of a high 
degree of practical equality which can diffuse and 
generalize opportunities to rise. The existence of 
such opportunities in fact, and not merely in form, 
depends, not only upon an open road, but upon an 
equal start. It is precisely, of course, when capacity 
is aided by a high level of general well-being in the 
milieu surrounding it, that its ascent is most likely 
to be regular and rapid, rather than fitful and 
intermittent. 

It is not surprising, therefore, that in England, 
where that condition does not exist, a large propor- 
tion of persons of eminence in different professions 
should be found to have been drawn from a minute 
group of comparatively well-to-do strata. Nor is it 
surprising that the indirect evidence derived from 
the schools which such persons attended should be 
confirmed by the researches of Professor Ginsberg 
into the parentage and antecedents of some 2,500 
individuals in different walks of life. Dividing them 
into three grades, (i) upper and middle, (ii) inter- 
mediate, and (iii) manual workers, he shows that, of 
the present generation in grade (i), only 12 per 
cent., and of the last generation in grade (i) only 
per cent., had fathers in grade (iii), while 72 per 
cent, of the present generation in grade (iii) had 
fathers in that grade, and 63 per cent, had grand- 
fathers. “There has been an increase of mobility 
upwards”, he writes, “in the present generation”, 
but “the social ladder so far lifts only relatively 
small numbers; there seems thus ... no indication 
that the reserves of ability in the lower classes are 
being depleted”."^ His conclusion is supported by 
the testimony of educational statistics, which show 



EQUALITY OF OPPORTUNITY 


”7 


that it is still only a small proportion of the children 
leaving elementary schools who pass on to some 
form of full-time education, and that the free-place 
system, in spite of its beneficent effects, had till 
recently done little to make such education accessible 
to the children of the poorest paid workers.® 
Statistical evidence as to the social origins of the 
higher grades in the world of industry is almost 
unavailable, except for the cotton industry, in which 
Sir Sydney Chapman and Mr. Marquis have shown 
reason for believing that as many as three-quarters 
of the employers may possibly be recruited from the 
ranks of the operatives. But the cotton industry — 
though its character is changing — ^has hitherto been 
peculiar in its combination of economic inequality 
with social mobility, and it is probable that similar 
investigations into the steel, engineering and ship- 
building industries, not to mention the hereditary 
torpor of coal, would yield somewhat different 
results. The reasonable verdict is that, perhaps, 
of Professor Carr-Saunders and Mr. Caradog Jones. 
^‘It is possible to imagine a society which is no 
respecter of persons, where the members somehow 
get into just those occupations for which they are 
best suited, no matter what the standing of parents 
may be. Such a state of society has . . . nowhere, 
as yet, been substantially realized.” In the absence, 
in short, of a large measure of equality of circum- 
stances, opportunities to rise must necessarily be 
illusory. Given such equality, opportunities to rise 
will look after themselves.® 

If a high degree of practical equality is necessary 
to social well-being, because without it ability can- 
not find its way to its true vocation, it is necessary 
also for another and more fundamental reason. It 



Ii8 THE HISTORICAL BACKGROUND 

is necessary because a community requires unity 
as well as diversity, and because, important as 
it is to discriminate between different powers, it 
is even more important to provide for common 
needs. Clever people, who possess exceptional gifts 
themselves, are naturally impressed by exceptional 
gifts in others, and desire, when they consider the 
matter at all, that societv should be organized to 
offer a career to exceptional talent, though they 
rarely understand the full scope and implications 
of the revolution they are preaching. But, in the 
conditions characteristic of large-scale economic 
organization, in which ninety per cent, of the 
population are wage-earners, and not more than 
ten per cent, employers, farmers, independent 
workers or engaged in professions, it is obviously, 
whatever the level of individual intelligence and the 
degree of social fluidity, a statistical impossibility 
for more than a small fraction of the former to 
enter the ranks of the latter; and a community 
cannot be built upon exceptional talent alone, 
though it would be a poor thing without it. Social 
well-being does not only depend upon intelligent 
leadership; it also depends upon cohesion and 
solidarity. It implies the existence, not merely of 
opportunities to ascend, but of a high level of 
general culture, and a strong sense of common 
interests, and the diffusion throughout society of a 
conviction that civilization is not the business of an 
elite alone, but a common enterprise which is the 
concern of all. And individual happiness does not 
only require that men should be free to rise to new 
positions of comfort and distinction; it also requires 
that they should be able to lead a life of dignity 
and culture, whether they rise or not, and that. 



EQUALITY OF OPPORTUNITY 


119 

whatever their position on the economic scale may 
be, it shall be such as is fit to be occupied by men. 

Human nature demands, no doubt, space and 
elbow-room. But there is an excellence of repose 
and contentment, as well as of effort; and, happily, 
the mass of mankind are not all elbows. If they 
possess powers which call for the opportunity to 
assert themselves in the contests of the market-place, 
and to reap the reward of successful rivalry, they 
have also qualities which, though no less admirable, 
do not find their perfection in a competitive struggle, 
and the development of which is not less indis- 
pensable to social health. Equality of opportunity 
implies the establishment of conditions which favour 
the expansion, not, as societies with a strong 
economic bent are disposed to believe, of the former 
alone, but of both. Rightly interpreted, it means, 
not only that what are commonly regarded as the 
prizes of life should be open to all, but that none 
should be subjected to arbitrary penalties; not only 
that exceptional men should be free to exercise 
their exceptional powers, but that common men 
should be free to make the most of their common 
humanity. If a community which is indifferent to 
the need of facilitating the upward movement of 
ability becomes torpid and inert, a community 
which is indifferent to all else but that movement 
becomes hardened and materialized, and is in the 
end disillusioned with the idol that it has itself 
created. It confuses change with progress. It sacri- 
fices the cultivation of spiritual excellences, which 
is possible for all, to the acquisition of riches, which 
is possible, happily, only for the few. It lives in an 
interminable series of glittering to-morrows, which 
it discovers to be tinsel when they become to-day. 



120 THE HISTORICAL BACKGROUND 

So the doctrine which throws all its emphasis 
on the importance of opening avenues to individual 
advancement is partial and one-sided. It is right 
in insisting on the necessity of opening a free career 
to aspiring talent; it is wrong in suggesting that 
opportunities to rise, which can, of their very 
nature, be seized only by the few, are a substitute 
for a general diffusion of the means of civilization, 
which are needed by all men, whether they rise or 
not, and which those who cannot climb the economic 
ladder, and who sometimes, indeed, do not desire 
to climb it, may turn to as good account as those 
who can. It is right in attaching a high significance 
to social mobility; it is wrong in implying that 
effective mobility can be secured merely through 
the absence of legal restraints, or that, if it could, 
economic liberty would be a sufficient prophylactic 
against the evils produced by social stratification. 
Men live in the present and future, not in the past. 
The outlook of individuals is normally determined 
by the group which they have entered, not by that 
which they have left, and the relations between 
classes have been less softened than was expected 
by the opening of avenues from one class to 
another. 

It was natural, indeed, in the mood of exhilara- 
tion produced by swiftly expanding economic 
horizons — the mood of England during much of the 
nineteenth century, and of the United States when* 
the tone of its economic life was still set by free 
land — that opinion should be hypnotized by the 
absorbing spectacle of a world in motion. It was 
natural to argue that the position of the proletarian 
was a secondary problem, since the proletarian of 
to-day was the capitalist of to-morrow, and that it 



EQUALITY OF OPPORTUNITY 


III 


was unnecessary to be perturbed by the existence 
of a chasm dividing classes, since the individuals 
composing them were free to cross it. As far as most 
parts of Europe, with its historic tradition of social 
stratification, were concerned, such an attitude was 
always a piece of economic romanticism. To-day it 
has long lost whatever plausibility it may once have 
possessed. 

The antidote which it had prescribed for economic 
evils had been freedom to move, freedom to rise, 
freedom to buy and sell and invest — the emancipa- 
tion, in short, of property and enterprise from the 
restraints which fettered them. But property pro- 
tects those who own it, not those who do not; and 
enterprise opens new vistas to those who can achieve 
independence, not to those who are dependent on 
weekly wages; and the emancipation of property 
and enterprise produces different effects in a society 
where the ownership of land and capital is widely 
diffused, from those which are caused by it where 
ownership is centralized. In the former, such 
property is an instrument of liberation. It enables 
the mass of mankind to control their own lives. 
It is, as philosophers say, an extension of their 
personalities. In the latter, until it has been bridled 
and tamed, it is a condition of constraint, and, 
too often, of domination. It enables a minority 
of property-owners to control the lives of the un- 
propertied majority. And the personalities which 
it extends are sometimes personalities which are 
already too far extended, and which, for the sake 
both of themselves and of their fellows, it would 
be desirable to contract. 

Thus, in conditions in which ownership is de- 
centralized and diffused, the institution of property 



122 


THE HISTORICAL BACKGROUND 


is a principle of unity. It confers a measure of 
security and independence on poor as well as on 
rich, and softens the harshness of economic contrasts 
by a common similarity of social status. But, in the 
conditions most characteristic of industrial societies, 
its effect is the opposite. It is a principle, not 
of unity, but of division. It sharpens the edge of 
economic disparities with humiliating contrasts of 
power and helplessness — ^with differences, not merely 
of income, but of culture, and civilization, and 
manner of life. For, in such conditions, the mass of 
mankind are lifelong wage-earners; and, though no 
barriers of caste limit their opportunities, though 
each is free to assume the risks and responsibilities 
of independent enterprise, what is possible for each 
is not possible for all, or for the great majority. 

Economic realities make short work of legal ab- 
stractions, except when they find them a convenient 
mask to conceal their own features. The character 
of a society is determined less by abstract rights 
than by practical powers. It depends, not upon 
what its members may do, if they can, but upon 
what they can do, if they will. All careers may be 
equally open to all, and the wage-earner, like the 
property-owner, may be free to use such powers 
as he possesses, in such ways as he is able, on such 
occasions as are open to him, to achieve such results 
as he is capable of achieving. But, in the absence of 
measures which prevent the exploitation of groups 
in a weak economic position by those in a strong, 
and make the external conditions of health and 
civilization a common possession, the phrase equality 
of opportunity is obviously a jest, to be described 
as amusing or heartless according to taste. It is 
the impertinent courtesy of an invitation offered 



EQUALITY OF OPPORTUNITY 123 

to unwelcome guests, in the certainty that circum- 
stances will prevent them from accepting it. 

Sir Fitzjames Stephen, writing when the indi- 
vidualist movement of the preceding half-century 
was as yet unexhausted, and the forces which later 
were to sap it were still hardly disclosed, touched 
its ethical pretensions with a realist’s indiscretion. 
Whatever its other achievements, he observed, it 
had produced a society marked by “inequality in 
its harshest and least sympathetic form”, in which 
“the power of particular persons over their neigh- 
bours has never, in any age of the world, been so 
well defined and so easily and safely exerted”.^® 
Privilege rested, it was true, not on legal principles, 
but on economic facts, and no man was debarred 
from aspiring to its prizes. But the most seductive 
of optical illusions does not last for ever. The day 
when a thousand donkeys could be induced to sweat 
by the prospect of a carrot that could be eaten by 
one was, even when Stephen wrote, drawing to 
its close, and by the present century was obviously 
long over. The miner or railwayman or engineer 
may not have mastered the intricacies of the theory 
of chances, but he possesses enough arithmetic 
to understand the absurdity of staking his happiness 
on the possibility of his promotion, and to realize 
that, if he is to attain well-being at all, he must 
attain it, not by personal advancement, but as the 
result of a collective effort, the fruits of which he 
will share with his fellows. The inequalities which 
he resents are but little mitigated, therefore, by 
the fact that individuals who profit by them have 
been born in the same social stratum as himself, 
or that families who suffer from them in one genera- 
tion may gain by them in the next. 



124 


THE HISTORICAL BACKGROUND 


Slavery did not become tolerable because some 
slaves were manumitted and became slave-owners 
in their turn; nor, even if it were possible for the 
units composing a society to be periodically re- 
shuffled, would that make it a matter of indifference 
that some among them at any moment should be 
condemned to frustration while others were cosseted. 
What matters to a nation is not merely the com- 
position and origins of its different groups, but their 
opportunities and circumstances. It is the powers 
and advantages which different classes in practice 
enjoy, not the social antecedents of the varying 
individuals by whom they may happen, from time 
to time, to be acquired. Till such powers and 
advantages have been equalized in fact, not merely 
in form, by the extension of communal provision 
and collective control, the equality established by 
the removal of restrictions on property and enter- 
prise resembles that produced by turning an ele- 
phant loose in the crowd. It offers everyone, except 
the beast and his rider, equal opportunities of 
being trampled to death. Caste is deposed, but 
class succeeds to the vacant throne. The formal 
equality of rights between wage-earner and property- 
owner becomes the decorous drapery for a practical 
relationship of mastery and subordination. 


(iii) 


^he Old Problem in a New Guise 

“Thanks to capitalism”, writes Professor See, in 
comparing the social system of the old regime with 
that which succeeded it, “economic divisions 



THE OLD PROBLEM IN A NEW GUISE 125 

between men take the place of legal ones.”^ The 
forces which cut deepest the rifts between classes 
in modern society are obvious and unmistakable. 
There is inequality of power, in virtue of which 
certain economic groups exercise authority over 
others. And there is inequality of circumstance or 
condition, such as arises when some social groups 
are deprived of the necessaries of civilization which 
others enjoy. The first is specially characteristic of 
the relations between the different classes engaged 
in production, and finds its most conspicuous 
expression in the authority wielded by those who 
direct industry, control economic enterprise, and 
administer the resources of land, capital or credit, 
on which the welfare of their fellows depends. The 
second is associated with the enjoyment and con- 
sumption of wealth, rather than with its production, 
and is revealed in sharp disparities, not only of 
income, but of environment, health and education. 

Inequality of power is inherent in the nature of 
organized society, since action is impossible, unless 
there is an authority to decide what action shall be 
taken, and to see that its decisions are applied in 
practice. Some measure, at least, of inequality of 
circumstance is not to be avoided, since functions 
differ, and differing functions require different 
scales of provision to elicit and maintain them. 
In practice, therefore, though inequality of power 
and inequality of circumstance are the fundamental 
evils, there are forms of each which are regarded, 
not merely with tolerance, but with active approval. 
The effect of inequality depends, in short, upon the 
principles upon which it reposes, the credentials to 
which it appeals, and the sphere of life which it 
embraces. 



126 THE HISTORICAL BACKGROUND 

It is not difficult to state the principles which 
cause certain kinds of inequality to win indulgence, 
however difficult it may be to apply them in 
practice. Inequality of power is tolerated, when the 
power is used for a social purpose approved by the 
community, when it is not more extensive than that 
purpose requires, when its exercise is not arbitrary, 
but governed by settled rules, and when the com- 
mission can be revoked, if its terms are exceeded. 
Inequality of circumstance is regarded as reasonable, 
in so far as it is the necessary condition of securing 
the services which the community requires — in so 
far as, in the words of Professor Ginsberg, it is 
‘‘grounded in differences in the power to contribute 
to, and share in, the common good’’.^^ 

No one complains that captains give orders and 
that the crews obey them, or that engine-drivers 
must work to a time-table laid down by railway- 
managers. For, if captains and managers command, 
they do so by virtue of their office, and it is by virtue 
of their office that their instructions are obeyed. 
They are not the masters, but the fellow-servants, 
of those whose work they direct. Their power is 
not conferred upon them by birth or wealth, but 
by the position which they occupy in the productive 
system, and, though their subordinates may grumble 
at its abuses, they do not dispute the need for its 
existence. 

No one thinks it inequitable that, when a reason- , 
able provision has been made for all, exceptional 
responsibilities should be compensated by excep- 
tional rewards, as a recognition of the service per- 
formed and an inducement to perform it. For 
different kinds of energy need different conditions 
to evoke them, and the sentiment of justice is 



THE OLD PROBLEM IN A NEW GUISE 127 

satisfied, not by offering to every man identical 
treatment, but by treating different individuals in 
the same way in so far as, being human, they have 
requirements which are the same, and in different 
ways in so far as, being concerned with different 
services, they have requirements which differ. 
What is repulsive is not that one man should earn 
more than others, for where community of environ- 
ment, and a common education and habit of life, 
have bred a common tradition of respect and 
consideration, these details of the counting-house 
are forgotten or ignored. It is that some classes 
should be excluded from the heritage of civilization 
which others enjoy, and that the fact of human 
fellowship, which is ultimate and profound, should 
be obscured by economic contrasts, which are 
trivial and superficial. What is important is not that 
all men should receive the same pecuniary income. 
It is that the surplus resources of society should be 
so husbanded and applied that it is a matter of 
minor significance whether they receive it or not. 

The enthusiasts, therefore, for true aristocracy, 
by which appears to be meant an aristocracy of a 
kind that has never existed, and all others who 
suppose that they would enjoy being governed by 
an intellectual elite, can calm the apprehensions 
which the demand for equality sometimes seems to 
arouse in them. They need not dread it as the un- 
creating word, whose utterance presages the return 
of chaos, while the curtain falls on universal darkness. 
The criticism which suggests that the effect of 
conceding it must be to submerge diversities of 
authority and office beneath a welter of undifferen- 
tiated atoms is, in reality, extravagantly 
propos. Men do not necessarily desire disorder 



128 THE HISTORICAL BACKGROUND 

because what passes for order seems to them, not 
order, but anarchy. A society which is conscious 
of the importance of maintaining gradations of 
authority and varieties of function is no more 
committed to the preservation of the plutocratic 
class system of to-day than to the re-establishment 
of the aristocratic class system of the eighteenth 
century, which also was defended in its day as 
the indispensable bulwark of social stability and 
economic efficiency. 

The phenomenon which provokes exasperation, 
in short, is not power and inequality, but capricious 
inequality and irresponsible power; and in this 
matter the sentiments of individuals correspond, it 
may be observed, with the needs of society. What 
a community requires is that its work should be 
done, and done with the minimum of friction and 
maximum of co-operation. Gradations of authority 
and income derived from differences of office and 
function promote that end; distinctions based, not 
on objective facts, but on personal claims — on 
birth, or wealth, or social position — impede its 
attainment. They sacrifice practical realities to 
meaningless conventions. They stifle creative activity 
in an elegant drapery of irrelevant futilities. They 
cause the position of individuals and the relation of 
classes to reflect the influence, not primarily of 
personal quality and social needs, but of external 
conditions, which offer special advantages to some- 
and impose adventitious disabilities upon others. 

Such advantages and disabilities are, in some 
measure, inevitable. Nor need it be denied that the 
area of life covered by them is narrower to-day 
than in most past societies. It would be difficult 
to argue, however, that their influence on the 



THE OLD PROBLEM IN A NEW GUISE 129 

destinies of individuals is trivial, or their effect 
on the temper of society other than deplorable. 
Dr. Irving Fisher has described the distribution of 
wealth as depending ‘‘on inheritance, constantly 
modified by thrift, ability, industry, luck and 
fraud”.^^ It is needless to labour the part which 
social forces play in determining the condition and 
prospects of different groups, since it is a truism 
expounded at length in the pages of economists. 
“A poor widow is gathering nettles for her children’s 
dinner. A courtly seigneur, delicately lounging in 
the CEiUde-Boeuf^ has an alchemy by which he will 
extract the third nettle and call it rent and law.” 
The inequalities arising from the receipt by private 
persons of monopoly profits, urban ground-rents, 
mineral royalties, financial windfalls and the other 
surpluses accruing when the necessary costs of pro- 
duction and expansion have been met, are a modern 
and more lucrative species of the picturesque genus 
pilloried by Carlyle. They resemble the predatory 
property of the old regime, in being a form of private 
taxation, the effects of which are partially corrected 
to-day by public taxation, but which remain 
mischievous. They create an inequality which, so 
far from arising from differences of service, is 
maintained in spite of them. They do not increase 
the real income of the nation, but diminish it. For 
they cause the less urgent needs of the minority 
to be met before the more urgent needs of the 
majority. 

Incomes from personal work obviously stand in a 
different category from incomes from property. 
But, even in such incomes, there is normally an 
element which is due less to the qualities of the 
individual than to the overruling force of social 



130 THE HISTORICAL BACKGROUND 

arrangements. We are all, it is a commonplace to 
say, disposed to believe that our failures are due 
to our circumstances, and our successes to ourselves. 
It is natural, no doubt, for the prosperous profes- 
sional or business man, who has made his way in the 
face of difficulties, to regard his achievements as the 
result of his own industry and ability. When he 
compares those who have succeeded in his own walk 
of life with those who have failed, he is impressed 
by the fact that the former are, on the whole, more 
enterprising, or forcible, or resourceful, than the 
latter, and he concludes that the race is to the swift 
and the battle to the strong. He rehearses, if he 
has had the good fortune to read it, the psalm of 
lamentation in which the late Lord Inchcape 
commemorated the sad fate of a gentleman who 
“by dint of hard work and economy found himself 
possessed of securities worth about ^^200,000”, 
and who then was brought low by taxation, and 
reduced, after paying it, to an income of no more 
than ^^6,500 a year. “All in these islands hitherto 
have had the opportunity, it may be by brains which 
have come to them by their fathers or mothers, or 
by example and upbringing coupled with applica- 
tion, industry, and honesty, to achieve what is called 
success in the world. From duke’s son to cook’s 
son, to quote Kipling, they all have their chance. 
Are we to scrap this and bring our dear old country 
down to the level of Soviet Russia, where, if anyone 
as much as . . . expresses belief in a Divine 
Creator, he is liable to be thrown into prison and 
shot? ” 

In so far as the individuals between whom com- 
parison is made belong to a homogeneous group, 
whose members have had equal opportunities of 



THE OLD PROBLEM IN A NEW GUISE 131 

health and education, of entering remunerative 
occupations, and of obtaining access to profitable 
financial knowledge, it is plausible, no doubt, if 
all questions of chance and fortune are excluded, to 
treat the varying positions which they ultimately 
occupy as the expression of differences in their 
personal qualities. But, the less homogeneous the 
group, and the greater the variety of conditions to 
which its members have been exposed, the more 
remote from reality does such an inference become. 
If the rules of a game give a permanent advantage 
to some of the players, it does not become fair 
merely because they are scrupulously observed by 
all who take part in it. When the contrast between 
the circumstances of different social strata is so 
profound as to-day, the argument — if it deserves to 
be called an argument — ^which suggests that the 
incomes they receive bear a close relation to their 
personal qualities is obviously illusory. 

In reality, as has often been pointed out, ex- 
planations which are relevant as a clue to differences 
between the incomes of individuals in the same group 
lose much of their validity when applied, as they 
often are, to interpret differences between those of 
individuals in different groups. It would be as 
reasonable to hold that the final position of com- 
petitors in a race were an accurate indication of their 
physical endowments, if, while some entered fit 
and carefully trained, others were half-starved, were 
exhausted by want of sleep, and were handicapped 
by the starters.^^ If the weights are unequal, it is not 
less important, but more important, that the scales 
should be true. The condition of differences of 
individual quality finding their appropriate expres- 
sion is the application of a high degree of social 



THE HISTORICAL BACKGROUND 


>32 

art. It is such a measure of communism as is needed 
to ensure that inequalities of personal capacity are 
neither concealed nor exaggerated by inequalities 
which have their source in social arrangements. 

While, therefore, the successful professional or 
business man may be justified in assuming that, if 
he has outdistanced his rivals, one cause is possibly 
his own “application, industry, and honesty”, and 
the other admirable qualities eulogised by Lord 
Inchcape, that gratifying conclusion is less than 
half the truth. His talents must be somewhat 
extraordinary, or his experience of life unusually 
limited, if he has not on occasion asked himself 
what his position would have been if his father had 
been an unemployed miner or a casual labourer; 
if he had belonged to one of the 9,397 families in 
Bermondsey — over 30 per cent, of the total number 
— ^living in 1927 at the rate of two or more persons 
to a room, or had been brought up in one of the 
one-apartment houses in the central division of 
Glasgow, 41 per cent, of which contained in 1926 
three or more persons per room; if he had been one 
of the million-odd children in the elementary 
schools of England and Wales who are suffering 
at any given moment from . physical defects;^* 
and if, having been pitched into full-time industry 
at the age of fourteen, he had been dismissed 
at the age of sixteen or eighteen to make room 
for a cheaper competitor from the elementary 
school. He may quite rightly be convinced that 
he gets only what he is worth, and that the forces 
of the market would pull him up sharply if he 
stood out for more. What he is worth depends, 
however, not only upon his own powers, but upon 
the opportunities which his neighbours have had 



THE OLD PROBLEM IN A NEW GUISE 133 

of developing their powers. Behind the forces of 
the market stand forces of another kind, Which 
determine that the members of some social groups 
shall be in a position to render services which are 
highly remunerated because they are scarce, and to 
add to their incomes by the acquisition of property, 
whilst those belonging to others shall supply services 
which are cheap because they are over-supplied, 
but which form, nevertheless, their sole means of 
livelihood. 

Such forces are partly, no doubt, beyond human 
control; but they are largely the result of institutions 
and policy. There is, for example, the unequal 
pressure of mere material surroundings, of housing, 
sanitation, and liability to disease, which decides 
that social groups shall differ in their ability to make 
the best use of their natural endowments. There is 
inequality of educational opportunity, which has as 
its effect that, while a favoured minority can 
cultivate their powers till manhood, the great 
majority of children, being compelled to compete 
for employment in their early adolescence, must 
enter occupations in which, because they are over- 
crowded, the remuneration is low, and later, 
because their remuneration has been low, must 
complete the vicious circle by sending their children 
into overcrowded occupations. There is the nepotism 
which allots jobs in the family business to sons and 
relations, and the favouritism which fills them 
with youths belonging to the same social class as its 
owners. There is inequality of access to financial 
information, which yields fortunes of surprising 
dimensions, if occasionally, also, of dubious repute, to 
the few who possess it. There is the influence of the 
institution of inheritance in heightening the effects 



134 the historical BACKGROUND 

of all Other inequalities, by determining the vantage- 
ground upon which different groups and individuals 
shall stand, the range of opportunities which shall 
be open to them, and the degree of economic stress 
which they shall undergo. 

The wage-earner who reflects on the distribution 
of wealth is apt, as is natural, to look first at the large 
dividends or watered capital of the firm by which 
he is employed. The economist looks at the large 
blocks of property which are owned by individuals 
and transmitted to their descendants, and which 
yield large incomes whether profits per cent, are 
high or low. He insists, with Professor Cannan, 
that “the inequality in the amounts of property 
which individuals have received by way of bequest 
and inheritance is by far the most potent cause of 
inequality in the actual distribution of property”. 
He points out, with Mr. Henderson, that the evil 
is progressive, since it causes “an initial inequality 
. . . to perpetuate itself throughout subsequent 
generations in a cumulative degree”. He urges, with 
Sir Ernest Simon, that “inheritance is responsible, 
not only for the most excessive, but for the most 
unjust and indefensible, inequalities”. Such state- 
ments are confirmed by the valuable researches of 
Mr. Wedgwood, who has made the economic effects 
of inheritance, almost for the first time, the subject 
of inductive investigation. The conclusion which he 
draws from the examination of a sample of large 
estates at Somerset House accords with common 
experience, but is not on that account the less 
perturbing. It is that, “on the whole, the largest 
fortunes belong to those with the richest parents. 
... In the great majority of cases the large fortunes 
of one generation belong to the children of those 



THE OLD PROBLEM IN A NEW GUISE 135 

who possessed the large fortunes of the previous 
generation. . . . 7here is in our society an hereditary 
inequality of economic status which has survived the 
dissolution of the cruder forms of feudalism. 

The advantages and disabilities which these 
phenomena create are properly described as social, 
since they are the result of social institutions, and 
can by the action of society be maintained or 
corrected. Experience shows that, when combined, 
as is normally the case, with extreme disparities of 
economic power between those who own and 
direct, and those who execute and are directed, 
but rarely own, they clog the mechanism of society 
and corrode its spirit. Except in so far as they are 
modified by deliberate intervention, they produce 
results surprisingly similar to those foretold by the 
genius of Marx. They divide what might have been 
a community into contending classes, of which one 
is engaged in a struggle to share in advantages which 
it does not yet enjoy and to limit the exercise of 
economic authority, while the other is occupied in 
a nervous effort to defend its position against 
encroachments. 



CHAPTER IV 


THE STRATEGY OF EQUALITY 


If the idea of equality has appealed less to English- 
men than to some other nations, they have learned, 
nevertheless, as a result of experience, that too 
religious a devotion to the opposite principle is 
liable to be attended by some practical incon- 
veniences. So, while protesting that nothing is 
farther from their minds than to be lured, like 
France in the past, or Russia to-day, by the equali- 
tarian mirage, they have permitted themselves to 
make fitful and circuitous approaches towards it. 
Without ceasing to gaze, in a bold, dignified 
manner, in the opposite direction, they have 
stumbled, in spite of their principles, into the 
employment of a technique, by which the im- 
practicable can, when they so desire, in some 
measure be performed, and by which some kinds of 
inequality have, in fact, been diminished. 

That technique is no mystery, and the measures 
embodying it are the most familiar of common- 
places. They belong, as everyone knows, to one or 
other of three principal types. There are those, in the 
first place, such as the extension of social services and 
progressive taxation, which mitigate disparities of 
opportunity and circumstance, by securing that* 
wealth which would otherwise have been spent 
by a minority is applied to purposes of common 
advantage. There are those, in the second place, such 
as trade unionism and industrial legislation, which 
set limits to the ability of one group to impose its 
will, by economic duress, upon another, and thus 

136 



137 


THE STRATEGY OF EQUALITY 

soften inequalities of economic power. There are 
those, in the third place, like the development of 
undertakings carried on as public services, or the 
co-operative movement, which secure for the 
public or the consumer all profit above a minimum 
rate of interest, and transfer the direction of 
economic policy from the hands of capitalists and 
their agents to those of an authority responsible 
to society. 

All attacks on inequality, whatever the method 
employed, encounter determined resistance from 
the privileged classes; and, during recent years, 
that resistance has hardened. It is an illusion to 
suppose that either of the first two policies can be 
carried forward on the scale, or with the speed 
required, as long as the key positions of the economic 
system remain in private hands. While, therefore, 
the development of communal provision and 
taxation, on the lines discussed in the present 
chapter, can be used, if we please, greatly to 
increase equality, it is not an alternative to the 
measures considered in the next, but the complement 
of them. It is a policy to be extended as rapidly as 
possible now, but which, till a radical change has 
been effected in the balance of economic power, will 
at every point be thwarted and checked. It is a 
mistake, however, to regard it as, for that reason, 
unimportant. To depreciate the social services as 
‘‘mere palliatives,’’ is a piece of clap-trap, which 
plays into the hands of the interests bent on saving 
the pockets of the rich at the expense of the 
children and the unemployed. A successful assault on 
the strongholds of capitalism demands a prolonged 
effort of intelligence and resolution. The more 
general establishment of the conditions of physical 



138 THE STRATEGY OF EQUALITY 

and mental vigour, which even to-day can, if with 
difficulty, be carried forward, is not a minor issue. 
In so far as it is achieved, it dissolves the servile 
complex which is a capital obstacle to effective 
action. It is a step towards the creation of a 
population with the nerve and self-confidence to 
face without shrinking the immense task of socialist 
reconstruction. 


(i) 


^he Method of Redistribution 


Proposals designed to alter the distribution of 
wealth are commonly confronted by an initial 
objection. They are necessarily, it is often alleged, 
condemned to futility, since the surplus available 
for redistribution is insignificant in amount. The 
pyramid creates an optical illusion, which causes 
the height of its apex to be exaggerated and the 
breadth of its base to be ignored. If the Himalayas 
were levelled, the surface of the globe would not be 
raised by more than a few inches, and the equal 
division of all incomes in excess of fZy^oo a year 
would not add 5s. a week to each family with less. 
The urgent necessity, so the familiar argument 
runs, is to increase the dividend, not to alter the 
proportions in which it is divided. 

Those who have the impertinence to walk up to’ 
ghosts can usually walk through them. This vener- 
able spectre has little to cause alarm, save the habit 
of iteration which is the spectre’s privilege. With a 
confidence unshaken by the lessons of experience, 
it contrasts the greater production of wealth with 
its wider distribution, as though production and 



THE METHOD OF REDISTRIBUTION 139 

distribution were irreconcilable alternatives, which 
the laws of the universe had for ever put asunder. 
It implores its hearers to concentrate their undivided 
attention on the average income per head of popu- 
lation, as though the only conceivable departure 
from existing arrangements were to redivide the 
national income into equal fractions, and to set 
everyone rubbing up his arithmetic to make sure 
of his quota. 

Such a treatment of the subject has only one 
defect; it is quite remote from reality. Its demon- 
strations are not, as its less cautious practitioners are 
in the habit of proclaiming, the voice of science, but 
a rhetorical device masquerading under a guise of 
scientific precision. Its dialectical victories are won 
with ease, for they are won over shadows. 

Everyone is the debtor of the statisticians whose 
labours, like the brilliant work of Professor Bowley, 
have supplied us with a quantitative picture of the 
nation’s income. But irreproachable premises some- 
times lead, in less experienced hands, to somewhat 
dubious conclusions, and it is not primarily, of 
course, the statistical basis of this line of argument 
which is its vulnerable point. The criticism to be 
made on it is not merely that, as Mr. Wedgwood 
points out, it combines earned and unearned income 
in a single total, though the latter, being relatively 
secure, is obviously worth more than the former; 
that it makes no allowance for the fact that the 
effect of a transference of wealth is to be judged, 
not only by the nominal value of the amounts trans- 
ferred, but also by the nature of the uses from which 
they are diverted and to which they are applied; 
that it ignores the truism that, since standards of 
well-being are relative, a lower average income. 



140 


THE STRATEGY OF EQUALITY 


with greater equality, may make a happier society 
than a higher average income, with less; and that, 
in defending inequality on the ground that the 
aggregate output of wealth is low, it argues in a 
circle, since the hostility and suspicion resulting 
from inequality are themselves one cause of a low 
output of wealth.^ Nor is the main criticism even 
that the fact of there being but little to divide is not 
in itself, perhaps, a convincing reason for dividing 
what little there is with the maximum inequality. 

The weakness of this whole line of argument is 
simpler and more fundamental. It is bombarding 
a position which no one occupies. For the method 
of redistributing wealth, whose futility such calcula- 
tions expose, so far from being the only method, 
or the most obvious method, or the method which 
advocates of redistribution are disposed to favour, 
is one which has been rarely proposed and more 
rarely followed, and which the unhappy sciolists 
in question have normally been at some pains to 
disclaim. What the popularizers of these exercises 
assert is that an increase in equality is not worth 
seeking, because, even were it attained, it would 
make but an insignificant addition to the income 
per head of the wage-earner and -his family. What — 
if statistical uncertainties are ignored — they succeed 
in proving is that the equal ( 
head is not a satisfactory ex 
equality. 

Their conclusion is correct. The expedient would, 
undoubtedly, be anything but satisfactory. But then 
it is an expedient which few have proposed. Is it 
rash to suggest that, if it is desired to obtain light 
upon the possibility of further diminishing inequality, 
the course of wisdom is not to spend energy in 


division of income per 
pedient for increasing 



THE METHOD OF REDISTRIBUTION 141 

belabouring a phantom, in which only its critics 
are so ingenuous as to believe, but to examine the 
methods by which some inequalities, at least, have 
already been diminished? The form which such 
methods have most commonly assumed is a matter 
of experience. It is not the division of the nation’s 
income into eleven million fragments, to be distri- 
buted, without further ado, like cake at a school 
treat, among its eleven million families. It is, on 
the contrary, the pooling of its surplus resources 
by means of taxation, and the use of the funds 
thus obtained to make accessible to all, irrespective 
of their income, occupation, or social position, the 
conditions of civilization which, in the absence of 
such measures, can be enjoyed only by the rich. 

It is possible for a society, experience suggests, 
by thus making the fullest possible provision for 
common needs, to abolish, if it pleases, the most 
crushing of the disabilities, and the most odious 
of the privileges, which drive a chasm across it. 
It can generalize, by collective action, advantages 
associated in the past with the ownership of property, 
for it has begun, in some measure, already to 
generalize them. It can secure that, in addition 
to the payments made to them for their labour, 
its citizens enjoy a social income, which is provided 
from the surplus remaining after the necessary 
costs of production and expansion have been 
met, and is available on equal terms for all its 
members. 

Such a policy is open to more than one criticism, 
but it is obvious that its effects are not to be ascer- 
tained by the most assiduous working of sums in 
long division. As everyone is aware from his personal 
experience, or can ascertain by reflecting upon such 



142 


THE STRATEGY OF EQUALITY 


venerable forms of public enterprise as the army and 
navy, collective expenditure makes possible results 
which would be unattainable, were an identical sum 
distributed, without futher adjustments, in fractional 
addition to individual incomes. It is one thing to 
lay out ;^ioo, and another, unfortunately, to spend 
800 half-crowns; nor is a joint-stock company with a 
capital of 10,000,000 the precise equivalent of 
10,000 tradesmen with a capital of ,^1,000. The 
contribution to culture of the reading-room of the 
British Museum is not to be calculated by dividing 
the annual cost of maintaining it by the number of 
ticket-holders. If each of the hundred thousand men 
who landed in France in August 1914 had been 
presented with the one-hundred-thousandth part 
of the cost of the first expeditionary force, and 
instructed to spend it, in the manner he thought 
best, in making the world safe for democracy, it 
is possible that the arrangement might have been 
welcomed by keepers of estaminets, but it is im- 
probable that the German advance would have 
stopped at the Marne. 

What is true of war is not necessarily false of 
peace, and collective expenditure does not lose its 
efficacy merely because the objects to which it 
is devoted are a public, instead of a private, interest. 
The ,^6,000,000 annually paid to the owners of 
minerals would, as has been remarked by their 
spokesman, increase the wages of miners by lesS 
than 8d. per shift, but it would go some way, even 
when allowance is made for the existing taxation 
upon them, towards providing pensions for a 
considerable proportion of aged miners. The 
£200,000,000 to £2^0,000,000 which, after allow- 
ing for the provision of new capital and for 



THE METHOD OF REDISTRIBUTION 143 

the revenue of the State, Professor Bowley has 
estimated, in his valuable book, as the maximum 
that, ‘‘on the extremest reckoning can have been 
spent out of home-produced income by the rich 
or moderately well-off on anything in the nature of 
luxury” in the United Kingdom in 1911, would, 
he writes, have been little more than sufficient to 
raise wages to the minimum standard suggested by 
Mr. Rowntree.^ How inconsiderable a trifle when 
regarded from one angle ! How pregnant with 
possibilities when regarded from another ! For 
^250,000,000 was approximately four times the 
total public expenditure upon social services in 
the year in question, when the expansion of such 
services was already causing apprehension. Had 
half of it been applied to them, it would have enabled 
the nation, without increasing the cost of production, 
imposing any additional burden upon industry, or 
reducing by a penny its investments of capital, to 
produce an improvement of not inconsiderable 
importance in the standard of life of the mass of the 
population. It would have sufficed, for example, to 
turn some industrial cities, with their enervating 
squalor, into regions of health, and even, perhaps, 
of beauty, to effect a revolution for the better in the 
staffing and equipment of primary schools, and to 
provide free secondary education for all children up 
to the age of sixteen. 

So, while the calculations which show the small 
output of wealth per head are true, they are neither 
the whole truth, nor the aspect of the truth which, 
for practical purposes, it is most important to 
remember. It may be a fallacy, as their authors 
insist, to imagine that the division of large incomes 
into equal fractions — ^were anyone so innocent as 



144 


THE STRATEGY OF EQUALITY 


to attempt it — ^would produce a substantial addition 
to incomes which are small. But it is equally falla- 
cious to ignore the truism that a small sum spent 
collectively on needs which are urgent yields more 
significant results than a larger sum spent in driblets 
on needs which are not. Inequalities of opportunity 
and circumstance are to be overcome, not by 
abandoning the economies of collective effort and 
massed expenditure, which are the grand achieve- 
ment of industrial civilization, but by exploiting 
them for the advantage of the whole community. 
Equality is to be sought, not by breaking into 
fragments the large incomes which are injurious 
both to those who receive them and to those who do 
not, but by securing that an increasing proportion 
of the wealth which at present they absorb will be 
devoted to purposes of common advantage. 


(ii) 


^he Growth and Significance of Communal Provision 

It is sometimes assumed that a clear principle 
of demarcation divides needs which may properly 
be supplied by collective action from those which 
individuals should be required to meet by their 
individual exertions. In reality, however, as a glance 
at the development of social services in different 
countries is sufficient to show, if such a principle 
exists, it either has not been discovered, or else is 
not observed. The line which is supposed to 
correspond with it, so far from being stationary, is 
in constant motion. The boundaries between the 
spheres of communal provision and private initiative 



GROWTH OF COMMUNAL PROVISION 145 

differ widely both from decade to decade, and from 
one community to another. 

The most impressive example which the present 
generation has seen of an immense effort to raise the 
standard of life of a whole people by collective 
action has been given by Russia. Unlike some 
western socialists, the Russians have not been so 
innocent as to suppose that a tolerable civilization 
can spring automatically into existence, as a result 
of the mere expropriation of the capitalist. They 
have realised that socialism cannot be built out of the 
serf mentality of a population scourged by ill-health, 
harassed by economic insecurity, and intellectually 
starved, and have deliberately undertaken, there- 
fore, the task described by Mr. and Mrs. Webb as 
‘‘the remaking of man’’. They have understood, in 
short, that, if a classless society is to become, not 
merely a phrase, but a practical reality, it can be 
established only by abolishing the disabilities which 
in capitalist societies attach to poverty, and by 
providing equally for all the advantages which in 
such societies are the privilege of wealth. It is to 
that objective that Russian policy has been directed, 
and the instrument which it has employed is the 
only instrument possible. It consists in the extension, 
on a scale elsewhere unknown, of what in this 
country are called the social services. All of them, in 
Russia, are still in their infancy; some doubtless show 
large gaps, are on a low plane of efficiency, or have 
still to be extended to the rural population. The 
significant point is that the goal of universal 
provision, publicly organised and financed, and 
bringing equal opportunities of civilization within 
the reach of all, is clearly envisaged, and generally 
accepted. If observers may be trusted, more progress 



146 THE STRATEGY OF EQUALITY 

towards it has been made in Russia during the last 
twenty years than some richer nations have achieved 
in more than twice that period. 

The fabric of communal provision, whose founda- 
tions have been laid in Russia with almost feverish 
haste, has elsewhere been constructed tentatively 
and piecemeal, amid almost continuous opposition 
from classes and interests which resented its growth. 
Of the forms of such provision existing to-day, not 
only were the majority unknown half a century ago, 
but their establishment was resisted, as a menace 
alike to individual morality and to economic 
prosperity. At the present time, there is no nation 
which does not treat as a public obligation some 
services which its neighbours continue to leave to 
the unaided efforts of the individuals requiring 
them, and resign to private charity others which 
elsewhere are regarded as a social function. England, 
with its modest system of pensions and insurance, 
seemed till recently a paupers’ paradise to un- 
instructed Americans. A state hospital service, 
such as exists in New Zealand, has hitherto been 
regarded in England, in spite of its thousand-odd 
hospitals maintained by Public Health Authorities, 
as an undesirable encroachment upon the sphere of 
philanthropy. Not only in their practical details, 
but in the whole conception of social responsibilities 
implied in them, the schemes of family allowances 
adopted by certain British Dominions and continental 
States are apt elsewhere to arouse some suspicion. 
The United States is commonly considered to be 
the country in which faith in the adequacy of 
individual effort and its pecuniary rewards is most 
sanguine and unquestioned. But free secondary 
education, which in England is still resisted as a 



GROWTH OF COMMUNAL PROVISION 147 

daring innovation, has long existed in most states 
of the American Union, while the expenditure on 
free social services of forty-eight states and cities 
with a population of over thirty thousand increased 
more than threefold between 1915 and 1926* 
America, nevertheless, was even worse prepared 
than Britain to meet depression. The attempt 
to create a system of public provision for the 
contingencies of life has been a not unimportant 
chapter in American history since 1932. 

For, in spite of variations in the practice of 
different communities, it is obvious that the range of 
requirements which are met by some form of 
collective action is everywhere being widened. The 
causes of the movement are not obscure. It is the 
natural consequence of the simultaneous develop- 
ment of an industrial civilization and of political 
democracy. An agricultural society, with its scattered 
households and unspecialized economic life, is 
normally both unconscious of requiring elaborate 
social services and incapable of providing them. 
Nor, on its first plunge into the world of the great 
industry, does it realize their necessity. Carrying the 
habits of the peasant into its new urban environment, 
it proceeds for a generation to poison its body and 
starve its soul, before it realizes that what is innocuous 
in a village is deadly in a town. Its philosophers 
at first do little to enlighten it. For, in their 
enthusiasm at the spectacle of increasing profits and 
wages, which are the natural result of increased 
productivity, they are disposed to interpret well- 
being as a commodity which, if unhampered by the 
State, individuals of character and intelligence can 
buy, in the necessary quantities, like tea and sugar, 
by their own exertions. 



148 THE STRATEGY OF EQUALITY 

The result is the paradox of rising pecuniary 
incomes and deepening social misery — both attested 
by equally incontrovertible historical evidence — 
which has emerged in all industrial revolutions, to 
the confusion of those who forget that ‘‘the timid, 
staring creature, man’’, is so compounded as to 
require, not only money, but light, air, and water, 
not to mention such uneconomic goods as tran- 
quillity, beauty, and affection. It is not till it is 
discovered that high individual incomes will not 
purchase the mass of mankind immunity from 
cholera, typhus, and ignorance, still less secure 
them the positive advantages of educational oppor- 
tunity and economic security, that slowly and 
reluctantly, amid prophecies of moral degeneration 
and economic disaster, society begins to make 
collective provision for needs for which no ordinary 
individual, even if he works overtime all his life, 
can provide himself. The effect of the discovery, in 
societies which have accepted political democracy, 
is that domestic politics are degraded, as is thought 
by some, or elevated, as it appears to others, into 
a debate upon questions of housekeeping. 

The reasons why, as far as certain fundamental 
necessities are concerned, the enterprise of individual 
profit-makers must necessarily fail to yield the 
maximum satisfaction, have been explained, in terms 
of economic theory, by Mr. Durbin. “Reduced to 
its barest outline”, he writes, “the theory of 
competitive equilibrium attempts to prove {d) that, 
if the goods demanded by the consumers can be 
subdivided, so that there are many buyers and many 
units in demand, and {h) if production can be 
organised without technical loss in a number of 
separate manufacturing and commercial units, the 



GROWTH OF COMMUNAL PROVISION 149 

best arrangement of resources will be secured by- 
private property in land and capital.” In reality, 
however, he continues, “it should be apparent at 
once that the theory of competitive equilibrium 
can cover only part of the economic field. An 
end which cannot be atomised cannot be dealt 
with by an atomic analysis. Such ends are common. 
Satisfaction may be derived from the contemplation 
or enjoyment of a certain set of relations embracing 
all elements in an economy, instead of from the 
consumption of a physically divisible entity, like 
boots. The enjoyment of economic equality, for 
example, means the establishment of an indivisible 
set of relations between all the human factors of 
production, in so far as they are the recipients of 
final income. Security from disease demands the 
observance of certain rules and the performance of 
certain productive tasks designed to create a 
particular condition affecting all parts of the 
community. Protection from external aggression — 
the condition of military preparedness — means 
that the organization of the whole industrial 
system must take on a certain character. The end 
in each of these cases is a complex and integrated 
whole. Such ends cannot be brought within the 
scope and calculus of competition. . . . They pre- 
suppose a social choice. For their achievement the 
central organization and control of economic life is 
essential. There is no evidence to suggest that these 
integral, or indivisible, or social, ends are quantita- 
tively less important than divisible or individual 
ends”.^ 

The examples given by Mr. Durbin could be 
multiplied almost indefinitely. No individual can 
create by his isolated action a healthy environment, 



150 THE STRATEGY OF EQUALITY 

or establish an educational system with a wide 
range of facilities, or organize an industry in such a 
manner as to diminish economic insecurity, or 
eliminate the causes of accidents in factories and 
streets. Yet these are all conditions which make 
the difference between happiness and misery, and 
sometimes, indeed, between life and death. In 
so far as they exist, they are the source of a social 
income, received in the form, not of money, but of 
increased well-being. 

Such an income, if on a scale still minute, is to-day 
taken for granted; in reality, however, it is a 
work of art. Its significance is best illustrated 
by the course of events in the country where 
its development, disastrously retarded though it 
was, has the longest history behind it. In the 
England which Mr. Podsnap saluted as ‘‘blest, 
sir, by Providence, to the direct exclusion of 
such other countries as there may happen to 
be”, neither the administrative machinery nor the 
fiscal technique required to provide it were yet 
in existence. A crude form of income-tax had 
just been re-established; grants-in-aid were virtually 
unknown; the only contribution of the State to 
anything which could be described as social welfare 
accounted, it is safe to say, for less than one per cent, 
of its total expenditure. The cities whose condition 
was described by Chadwick as that of “an encamped 
horde, or an undisciplined soldiery”,® were an 
Eden into which the serpent of communal enterprise 
had not yet penetrated. For crime there was prison, 
and for destitution the workhouse; but the environ- 
ment of the common man, unless a criminal or 
pauper, was hardly less exclusively the creation of 
economic appetites than in a mining camp. Un- 



GROWTH OF COMMUNAL PROVISION 151 

dismayed by progressive taxation, the property- 
owner could spend on himself, or invest as he 
pleased, almost the whole of the fortune which the 
tide of economic expansion washed to his feet. 
Unfettered by legal restrictions, the wage-earner was 
free to do everything which cholera, typhus, and 
enteric, a working day of anything from twelve to 
eighteen hours, and an absence of facilities for 
education so complete that as late as 1870 only two- 
fifths of the children between six and ten were in 
attendance at school, would permit of his doing. 

In such conditions the most fundamental of 
inequalities was simple and unmistakable. It was 
not that one class was rich and another poor. It was 
that one class lived and another died. A ^‘gentleman^’ 
in London, the Commissioners of 1844 were told, 
lived on the average twice as long as a ‘‘labourer”, 
while the corresponding figures for Leeds were 
forty-four and nineteen years, and for Liverpool 
thirty-five and fifteen. “It is a melancholy fact”, 
wrote, as late as 1865, the most distinguished of 
contemporary economists, “that the whole structure 
of our wealth and refined civilization is built upon 
a basis of ignorance and pauperism and vice, into 
the particulars of which we hardly dare to inquire, 
. . . We are now in the first morning of our 
national prosperity and are approaching noon, yet 
we have hardly begun to pay the moral and the 
social debts to millions of our countrymen which 
we must pay before the evening.” The formulation 
of the doctrine of an inevitable class war is not 
surprising. It was an accurate description of the 
prevailing practice.® 

The generation after 1850 had unique oppor- 
tunities, for it was favoured by fortune. It was a 

F* 



152 THE STRATEG;Y OF EQUALITY 

period of swiftly increasing returns, the golden age 
of individualist capitalism. Thanks to her almost 
exclusive command of the new technique of 
manufactures and transport, combined with access 
to the produce of virgin lands, England garnered for 
a space a monopolist’s profits, and the yield of id. 
on the income-tax more than doubled in the thirty 
years between 1842-51 and 1872-81. The course 
of wisdom would have been to invest in the develop- 
ment of social services when investment was easy. 
It would have been, as Jevons suggested, to use the 
wealth of a coal age that would one day contract 
to build up a fabric of communal provision, which 
would ensure that the nation would draw in the 
future on the full physical and intellectual energies 
of all its members. 

By a familiar dilemma, however, expenditure 
which, in times of stress, is denounced as extravagant, 
in times of prosperity is dismissed as unnecessary, 
and the warning that summer would not last for 
ever fell on deaf ears. So, while profits and wages 
increased with the expansion of profit-making 
enterprise, the investments which would yield a 
social income continued to be starved. Launched by 
Chadwick and the Poor Law doctors in the ’forties, 
and carried forward by a band of devoted pioneers 
in the teeth of general apathy and suspicion, the 
Public Health movement won beneficent victories 
in the last half of the century. But it was concerned 
almost exclusively with environmental problems;* 
and, when in 1890 the official head of the system 
wrote his study of the first fifty years of its develop- 
ment,’ its triumphs were still those of the sanitary 
engineer rather than of the doctor. Though 
cholera and typhus had been virtually stamped out. 



GROWTH OF COMMUNAL PROVISION 153 

and the death-rate from enteric largely reduced, 
infantile mortality was actually as high for the 
decade 1891-1900 as for 1851-60. In the last 
five years of the century it reached, for the country 
as a whole, the appalling figure of 156 per 1,000. 

If, in the sphere of health, inequality was the 
practice of the age, in that of education it was a 
principle and a dogma. In origin a discipline, half- 
redemptive, half-repressive, for the lower orders, 
elementary education has been, throughout its 
history, not an educational, but a social, category. 
It had been designed for those for whom it was 
expedient to provide the rudiments of instruction, 
since, if wholly untaught, they were a danger to 
society, but inexpedient to provide more, since they 
were equally a danger, if taught too much. It was 
to be kept, the Committee of Council had insisted 
in 1839, “in close relation with the condition of 
workmen and servants”. A generation later, Mr. 
Lowe, as Vice-President of the Committee, could 
still describe elementary education as “the education 
of the labouring poor”, and repudiate with 
emphasis the impious suggestion that it might 
enable them “to raise themselves above their 
station and business in life”.® The tranquil, un- 
sophisticated class-consciousness which the words 
reveal continued to cling to it long after a new era 
had begun with the Act of 1870. Even in 1890—1 
the total expenditure on public education was only 
/l 0,079,000, of which approximately one-fifth was 
derived from fees paid by the parents of the children 
concerned. 

The modern public health system, with its 
concern, not merely for the improvement of the 
environment, but for the health of the individual. 



>54 


THE STRATEGY OF EQUALITY 


is the creation, in the main, of the period since 
1900, and largely, indeed, of that since 1914. The 
modern system of public education is equally the 
achievement of the present century. It was not till 
1908 that attention to the physical well-being of 
children became part of the duties of Local Education 
Authorities. The movement which has produced 
the 1,380 grant-aided secondary schools of to-day, 
with their 456,000 pupils, dates only from 1 902, 
and the free-place system, which has revolutionized 
the whole relation between primary and secondary 
education, from 1907. The humanizing of the 
curriculum and atmosphere of the primary schools; 
the decision of some enlightened authorities to 
free secondary education by abolishing fees in 
the schools maintained by them; the rise in the 
status of the teaching profession; the growth of 
the half-dozen Universities and University Colleges 
of 1890 to the sixteen of to-day, and the expansion 
of each of them; the establishment of a rudimentary, 
but developing, system of state scholarships; and 
the appearance of an adult education movement 
with some hundred thousand students, are even 
more obviously the result of changes in educational 
policy, and still more in educational thought and 
social structure, which would- have been incon- 
ceivable before 1900. From services which the 
market, supplemented by private charity and public 
subsidies, had been left to provide in accordance 
with sound commercial principles, with the result' 
that, except for the well-to-do, no service adequate 
in quantity or tolerable in quality had, in fact, been 
provided, health and education have been partially 
communalized. They have been moving towards a 
condition in which they will be administered, apart 



GROWTH OF COMMUNAL PROVISION 155 

from a few eccentric institutions, as public under- 
takings available for all, irrespective of the financial 
resources or social standing of the individuals using 
them. 

Nor was it till the opening decades of the present 
century that the first steps were taken towards the 
development of a third form of communal provision, 
which has reached, in our own day, unanticipated 
dimensions. The conviction that all social services, 
whatever their form, were in reality merely a variety 
of poor relief had stood high among the superstitions 
of the Victorian era. The Report of 1834, with its 
teaching that poverty was increased by the measures 
designed to diminish it, had been revered for three 
generations as a canonical book. Even after 1900, 
it continued to be invoked to condemn in turn the 
feeding of school-children, the grant of old-age 
pensions and the maintenance of the unemployed 
apart from the Poor Law, as a defiance alike of 
sound morality and of the teachings of science. 
With the passage, between 1906 and 1911, of 
legislation designed, though on a humble scale, to 
establish all three, the theory that to supplement 
the resources of individuals in money or in kind 
was to court disaster was tacitly abandoned. The 
foundations were laid of the protective structure 
which was to soften the shock of the post-war crisis. 

The repudiation of the fiscal conceptions of an 
age when economy was commonly interpreted as the 
prevention of expenditure on public purposes — 
the age when one famous statesman could propose 
the complete abolition of the income-tax, and another 
could denounce death duties of 8 per cent, on estates 
of 000,000 as playing with fire — ^was equally 
significant. It took place even later. Though financial 



156 THE STRATEGY OF EQUALITY 

policy was beginning in the ’nineties to describe 
the first faint segments of a majestic curve, another 
quarter of a century was to elapse before the full 
meaning of the movement became apparent. In 
1903-4 a rational system of graduation had not begun 
to be adopted, and even in 1913-14, in spite of the 
improvements of the preceding decade, taxation 
was so far regressive that a man with an income 
of ;^ioo is estimated to have paid actually a larger 
percentage in taxation than a man earning £ 2 , 000 . 
In 1925-6, though still regressive on incomes up 
to and including £ 1 , 000 , it was so far progressive 
that an earned income of ^1,000 paid ii per cent., 
an earned income of £ 20 , 000 — if the phenomenon 
exists — 37*5 per cent., and an income of £ 20 , 000 , 
half-earned and half-unearned, 48*7 per cent.® 
Two points, however, must be remembered. The 
first is that — since the service of the debt absorbs 
more than half the yield of income-tax, surtax, 
and death duties — the larger part of the sums which 
the wealthier classes pay in taxation they pay in 
interest to themselves. The second is that, especially 
since 1931, the proportion of the national revenue 
raised by direct taxation has diminished, and that 
obtained by indirect taxation has increased, with 
the result of throwing a heavier burden on the 
smaller incomes. According to the estimate of Mr. 
Colin Clark, the share of local and national taxation 
borne by the working classes was 34-3 per cent, 
in 1913-14, 28*6 per cent, in 1925-6, and 33*0 per 
cent, in 1935-6.^® 


“The artisan”, groaned Herbert Spencer in 1884, 
“obtains from a fund raised by taxes certain benefits 



GROWTH OF COMMUNAL PROVISION 157 

beyond those which the sum received by his labour 
enables him to purchase.”^ The movement whose 
first faint beginnings aroused Spencer’s apprehension 
is still in its infancy, but it has grown, since he wrote, 
to considerable dimensions. Public expenditure on 
social services in England and Wales (exclusive of 
contributions, such as fees and employers’ and 
workmen’s insurance payments, from sources other 
than rates and taxes) was ,£16,063,000, or lis. id. 
per head of population, in 1890-1; in 1934-5 (the 
latest year for which figures have been published) 
it was, excluding war pensions, ,£276,186,000, the 
equivalent of ,£242,505,000, or ,£5 19s. lod. per 
head of population, at the price-level of 1890.^^ 

The principal lines along which this advance has 
taken place are four. The first is expenditure on the 
improvement of the environment; the second, the 
development of free services; the third, the creation 
of supplementary sources of income; the fourth, 
progressive taxation. The first and second were in 
their infancy when Spencer wrote; the third (if 
the Poor Law be excepted) and the fourth did not 
yet exist. It is sometimes suggested that the increased 
social expenditure of the last thirty years is to be 
interpreted as a symptom of wholesale pauperization. 
It may be noted in passing, therefore, that the 
statistics of the movement lend little confirmation 
to the view that the growth in the outlay on the 
social services is due primarily to lavish and 
indiscriminate assistance to persons in distress. 

In reality, the relative importance of different 
services has completely changed, and changed in 
precisely the opposite direction from that which 
gives rise to the lamentations of the press. While 
public expenditure on poor relief has increased less 



158 THE STRATEGY OF EQUALITY 

than fivefold since 1890, that on education has grown 
over twelvefold, and that on public health (including 
health insurance) and housing about eightyfold. The 
first accounted for 52 per cent, of the total social 
expenditure from public funds in 1890-1; in 
1934-5 it accounted for 14 per cent., or, if state 
expenditure on unemployment insurance is included, 
33 per cent. The largest single item is expenditure 
on education, which accounted in the same year 
for 30 per cent. The picturesque theory that the 
greater part of existing social expenditure consists 
of “doles” may continue to be believed by readers 
of the Daily Mail, but it is a delusion which has 
ceased to be plausible for a quarter of a century. 
Nor, it may be added, is there any better foundation 
for the suggestion that the extension of public 
provision has discouraged private thrift. The in- 
equality with which property is distributed remains, 
as has been shown above, fantastic; but the 
accumulated savings of small investors are estimated 
by Professor Carr-Saunders and Mr. Caradog 
Jones to have grown from j(^498,ooo,ooo in 1913 to 
,^1,375,000,000 in 1925, the equivalent, at the 
price-level of 1913, of ,^859,000,000. “There is no 
evidence”, they conclude, “that the advent of state 
schemes has led to a slackening of individual effort 
to provide against the changes and chances of life”. 
Since that date such savings have further increased.^® 
This inchoate fabric of social provision has several 
different aspects. From one point of view it is 
analogous to a scheme of priorities, such as that 
with which the country was familiarized during the 
war: within the narrow, though widening, area of 
life covered by it, it ensures that necessaries shall 
be provided before trivialities. From another, it 



GROWTH OF COMMUNAL PROVISION 159 

involves the direction of productive effort into new 
channels: doctors are set to work instead of gardeners, 
and the gamekeeper or chauffeur of the last genera- 
tion becomes the teacher or the civil servant of the 
next. From a third, it results in the creation of 
new social capital; England put its surplus resources 
into cotton-mills and railways before it invested in 
sewers, not to mention parks, schools, and libraries; 
to-day the balance, though tardily and inadequately, 
is being corrected. From a fourth, it somewhat 
mitigates instability of demand, and, therefore, 
of employment: in the words of the Majority Report 
of the Colwyn Committee, “it supports and steadies 
the purchasing power over consumption goods, 
which is unreservedly beneficial to industry”,^* 
and which is, it may be added, of special importance 
when foreign markets are contracting and workers 
are threatened with displacement by rationalization. 
From a fifth, it is an instrument which supplies 
the individual with subsidiary resources, partly in 
money, partly in kind, partly in the increase of his 
opportunities and in the improvement of his 
environment. Some small proportion of the national 
output of wealth consists of goods and services 
which are produced, not by profit-making enter- 
prise, but by collective action, and which are 
distributed in proportion, not to the means, but to 
the needs, of their beneficiaries. In some small 
degree, the standard of life of the great mass of the 
nation depends, not merely on the remuneration 
which they are paid for their labour, but on the 
social income which they receive as citizens. 

The rise of this rudimentary communism has 
taken place without design and almost unconsciously, 
as a method of coping with grave practical evils. 



i6o THE STRATEGY OF EQUALITY 

But its pioneers built better than they knew, and it 
is possible that the famous words, which Adam 
Smith applied to the individual enterprise of the 
eighteenth century, may one day appear not too 
inapplicable to the collective enterprise of the 
twentieth. While aiming primarily at quite other 
objects, it has begun, though, as yet, not more than 
begun, to achieve an end which was no part of its 
design. Its effect is obviously that the final distribu- 
tion of the national income differs, in greater or 
less degree, from the initial distribution which takes 
place as a result of the bargains struck between 
individuals and groups in the higgling of the market. 
Those who, as a result of such action, pay less in 
taxation than the value of the goods and services 
which they receive from public funds, find their 
real incomes increased. Those who pay more find 
them diminished. The effect, for example, of the 
payment of the national debt charges, now some 
£ 22 ^, 000 , 000 , is, as the majority of the Colwyn 
Committee remarked, to increase inequality, since 
it involves the transference of wealth from small 
incomes to large.^® The effect of an extension of 
social services, accompanied by progressive taxation, 
is to diminish inequality, since it involves, though 
at present on an extremely modest scale, the 
transference of wealth from large incomes to small. 
Thus, the observation, not infrequently advanced 
with a knowing air of superior sagacity, that it is 
not possible to make the poor richer by making the 
rich poorer, is hardly to be regarded, perhaps, as the 
last word of science. 

It would be absurd to exaggerate the effects of a 
policy which is still in its first youth, and the 
development of which is fought at every turn. 



GROWTH OF COMMUNAL PROVISION i6i 

Expressed in terms of money, the change in the 
distribution of wealth resulting from it is at present 
minute. It is probably, indeed, even smaller to-day 
than it was a decade ago. For the “economy’^ ramp 
of 1931 to 1935 arrested or slowed down the growth 
of expenditure on education and health; while the 
establishment of a general tariff has diminished the 
proportion of the public revenue derived from 
taxation on large incomes, and has increased the 
proportion contributed by the poorer classes. The 
general result has been stated by Mr. Colin Clark. 
‘‘The net effect of taxation and local rates in 1935’’, 
he writes, “can be described as a redistribution of 
j^9i millions from the rich to the poor in the form 
of services other than those provided for from 
working-class taxation’’.^® That figure was something 
under 2 per cent, of the national income for the 
year in question, and was equivalent to slightly 
less than 6 per cent, on the total wage-bill. 

In view of the oft-repeated statement that the 
rich are heavily taxed to provide for the mass of 
the population benefits in which the former do not 
share, these facts should be remembered. They are, 
however, only part of the story. The significant 
feature in the history of the social services is not the 
magnitude of the redistribution of wealth effected 
by them. It is the magnitude of the results which 
even a slender and reluctant measure of re- 
distribution has been sufficient to produce. 
Inequalities of health, of educational opportunity, 
and of security remain appalling. But it is not a 
small thing that certain diseases should have been 
virtually wiped out; that, in the words of Sir George 
Newman, “on the average, a baby born to-day will 
live twelve years longer than his grandfather”;^"^ 



i62 the strategy OF EQUALITY 

that some measure of educational provision, cramped 
and meagre though it is, should be made for all 
children up to fourteen; and that the tragedies of 
sickness, of age and unemployment should have 
been somewhat mitigated. Compared with what 
might be accomplished, these achievements appear 
trivial. Compared with the actual conditions of a 
generation ago, they represent the first harvest of a 
pohcy, tardily adopted and persistently sabotaged, 
which, if resolutely pursued, can make the essentials 
of civilisation a common possession. 

To appreciate the significance of that policy, 
it is sufficient to consider what the consequences 
would be, could its successes, humble though 
they are, be suddenly obliterated. The national 
expenditure would revert to the shape which it 
possessed in 1850, when over 90 per cent, of it 
consisted of interest on the debt, and of the costs 
of the army and navy. With the reduction of 
taxation, the pecuniary incomes of the propertied 
classes would increase, till they were subsequently 
reduced by the general decline in economic efficiency. 
Infantile mortality and the general death-rate would 
bound up. The mass of children under fourteen 
would become — what many children over fourteen 
still are — ^the “little helots” described by Jevons. 
The aged, the sick and the unemployed would be 
thrown back on the Poor Law. It is probable, 
nevertheless, that the resulting social order would 
be held to be as natural, as inevitable, and as con- 
ducive to edification, as that of our own day, of the 
nineteenth century, and of all other centuries since 
the world began. It would be explained, with 
redoubled assurance, that the relative position of 
classes is wholly uninfluenced by environmental 



EXTENSION OF THE SOCIAL SERVICES 163 

influences, or economic conditions, or legal institu- 
tions, but is determined by the innate biological 
characteristics of the individuals composing them — 
characteristics whose effects no change in the 
external order can hope to modify, and with whose 
mysterious, ineluctable operation misguided re- 
formers will tamper at their peril. 


(hi) 


^he Extension of the Social Services 


As a method of correcting the gravest results of 
economic inequality, this combination of communal 
provision and progressive taxation has obvious 
advantages. It secures for the common benefit 
the surpluses which no advance in the standard 
rate of a trade or district, based, as it necessarily is, 
on what the least favourably situated firms can afford 
to pay, can succeed in touching. Unlike a rise in 
wages secured by a trade union, it taps, not merely 
the resources of a particular industry, but wealth of 
all kinds, whatever its source, including that arising, 
not only from production, but from finance, 
speculation, commerce, and the unearned increment 
of urban ground-rents. It can be continued and 
extended in periods of depression, when it is difficult 
to secure an improvement of wages, and can thus 
be used to prevent a temporary depression producing 
the permanent catastrophe of a decline in the 
health and moral of the rising generation. In so far 
as, like the income tax, it falls on profits, it does not 
raise the cost of production or increase prices. By 
taking money where it can most easily be spared, and 



i64 the strategy OF EQUALITY 

spending it where it is most urgently needed, it 
produces the maximum of social benefit with the 
minimum of economic disturbance. By concen- 
trating surplus resources, directing them to objects 
of primary importance, and applying them, as in 
the case of the services of health, housing, and 
education, under expert advice and in accordance 
with a specialized technique, it makes possible the 
attainment of results which no body of individuals, 
even though they spent ten times the sums involved, 
could achieve for themselves by their isolated action. 


The technique of such a policy is a matter for 
specialists, but its immediate objectives are not 
difficult to state. Burke remarks that all men have 
equal rights, but not to equal things, and there is a 
truth in the distinction which is justly applauded. 
But, unfortunately. Nature, with her lamentable 
indifference to the maxims of philosophers, has 
arranged that certain things, such as light, fresh air, 
warmth, rest, and food, shall be equally necessary 
to all her children, with the result that, unless they 
have equal access to them, they can hardly be said 
to have equal rights, since some of them will die 
before the rights can be exercised, and others will 
be too enfeebled to exercise them effectively. The 
inequality in the incidence of disease between 
different classes is illustrated by the table opposite, 
which gives the vital statistics of two poor and two 
well-to-do districts in a single city in the year 
1926.^® 

Such contrasts, it need hardly be observed, are not 
peculiar to Glasgow. Dr. Veitch Clark, the Medical 
Officer of Health for Manchester, showed some years 



EXTENSION OF THE SOCIAL SERVICES 165 



City of 
Glasgow. 

Mile End 
Ward. 

Gorbals 

Ward. 

Langside 

Ward. 

Cathcart 

Ward. 

Population 

1,101,622 

26,015 

521^36 

I9>i39 

16,999 

Density : Persons per acre 
Birth-rate per 1,000 per- 

57 

136 

207 

45 

22 

sons living .... 
Death-rate per 1,000 per- 

22*1 

31 ‘O 

27*3 

12-4 

10*2 

sons living .... 
Infant Mortality Rate : 
Deaths under i year per 

14-2 

17*6 

17-2 

9-2 

00 

1,000 births .... 
Phthisis : Death-rate per 

104 

163 

128 

44 

5^ 

1,000 persons living 
Respiratory Diseases: 
Death-rate per 1,000 

0-86 

I *04 

I *03 

0*38 

o*i8 

persons living 

Infectious Diseases: 
Death-rate per i ,000 

2-47 

3*66 

3*84* 

1 *08 

076 

persons living 

0‘8i 

I -69 

1-86 

0*11 

0*12 


ago that, if the city were divided into two sections 
of almost equal population, one consisting of the 
more densely populated, and the other of the less 
densely populated, districts, the divergence in 
health between the two was equally shocking. The 
general death-rate in the former, he stated, was 
16 per 1,000 compared with iO'5 in the latter, 
and the infantile mortality rate 20 per cent, greater, 
while deaths from seven specified diseases were 
from 31 to 57 per cent, higher, and the number of 
persons attacked by pneumonia and tuberculosis 
higher by 34 and 28 per cent, respectively.^® The 
last Decennial Census of the Registrar-General told 
the same story. Dividing the whole population into 
five social classes, and representing the general level 
of infantile mortality by 100, he found that the 
infantile mortality rate in what he called the 
“independent class” was 48, in the middle class 70, 


i66 THE STRATEGY OF EQUALITY 

and in the poorest labouring class 123, The contrast 
between the death-rates from different diseases of 
different groups of adults was even more striking. 
Death from bronchitis was about eight times as 
frequent among the poor as among the rich, while 
tuberculosis killed three of the former to each 
one of the latter.^ 

Ill-health and incapacity gravitate to, and aggra- 
vate, inferior surroundings, in addition to being 
created and aggravated by them. It would be 
incorrect to assume, therefore, that these contrasts 
of health have their sole explanation in contrasts 
of environment. But, if grapes will not grow on 
thorns, or figs on thistles, neither, without soil, 
sunshine and rain, will grapes grow on vines, or 
figs on fig-trees. Disease, like machine-guns, kills 
indiscriminately the genius and the fool, as the 
institution of inheritance protects indiscriminately 
the fool and the genius. One who accepts the view 
that it is important to improve the biological 
quality of the race is no more required, therefore, 
to tolerate the preventable misery caused by the 
environmental evils of bad housing, unhealthy 
factories, and defective education, than he is to 
regard with equanimity the more spectacular horrors 
of war, pestilence, and famine, which also have 
sometimes been described as the agents of natural 
selection. 

On the effect of such evils in producing disease, 
those best entitled to speak express themselves with 
no uncertain voice. In the cautious words of Sir 
Arthur Newsholme, “evidently environmental 
influences, with some possible influence of migration 
in addition, are predominant in the circumstances 
of civilized life in a large community. . . . The 



EXTENSION OF THE SOCIAL SERVICES 167 

difference [in the infantile mortality rate of different 
areas] in the main is due to certain removable 
evils, which are commonly associated with poverty, 
and from which the well-to-do in a large measure 
escape”. Sir George Newman has said the same. 
^^Definite, simple, and essential”, he writes, though 
‘‘the fundamental requirements of healthy child- 
hood” are, “they constitute the heritage of the few 
rather than the many. That this is so, has been and 
is still largely due to social causes”. So, in effect, 
have Dr. Kerr, the late Chief Medical Officer of 
the London County Council; Dr. Veitch Clark, who 
states that overcrowding is one factor in the high 
sickness and mortality rates of the poorer districts 
of Manchester; and Dr. Childe, who urged in his 
presidential address to the British Medical Associa- 
tion in 1923 that, by tolerating the continuance of 
overcrowding and insanitary conditions, the nation 
is providing “the breeding-ground for the mass 
production of disease”. “On the present data we 
are entitled to conclude”, writes Dr. Isserlis in his 
valuable study, The Relation between Home Conditions 
and the Intelligence of School Children^ “that pro- 
gressive improvement in home conditions may be 
expected to react favourably, not only on the 
health, but also on the intelligence of school 
children”; and Dr. Burt, who contributes an 
introduction to it, summarizes its results as indicating 
that, “in loose, non-technical language, the 
importance to the child of social circumstances is 
as one in three”. The general results of the conditions 
which are specially characteristic of the poorer 
quarters of great towns are described by Sir Arthur 
Newsholme in words of dreadful simplicity. It is 
“the increasing total mortality with lowering of 



i68 THE STRATEGY OF EQUALITY 

social position’’. As in the days of the Heptarchy, 
the weregild of the churl is still smaller, it seems, 
than that of the thane.^ 

Health, we have been told by a Chief Medical 
Officer of the Board of Education, is a purchasable 
commodity, of which a community can possess, 
within limits, as much or as little as it cares to pay 
for. It can turn its resources in one direction, and 
fifty thousand of its members will live who would 
otherwise have died; it can turn them in another, 
and fifty thousand will die who would otherwise 
have lived. Though no individual, by taking 
thought, can add a cubit to his stature, a nation, 
by doing so, can add an inch to the height of some 
groups among its children and a pound to their 
weight.^ What is called — ^though not by econo- 
mists — economy, does not only mean, in short, the 
curtailment of the frills which, to high-spirited 
people, who themselves have had enough of them, 
seem so superfluous and unprofitable in the ele- 
mentary schools. It means that the children attending 
such schools are smaller and feebler than they 
otherwise would have been, and smaller and feebler 
than the children in the schools to which the 
high-spirited people send children of their own. 

For, if health is purchasable, it is also expensive. 
For the mass of mankind its conditions must be 
created by collective action, or not at all. It is, 
perhaps, not surprising, therefore, that the publica- 
tions both of unofficial experts and of the Ministry 
of Health should be a homily on the theme that 
the admonition, ‘‘Bear ye one another’s burdens”, 
is the voice, not merely of piety and good manners, 
but of economic prudence. Authorities may differ 
as to the relative urgency of particular measures; 



EXTENSION OF THE SOCIAL SERVICES 169 

but they are unanimous that, given the expenditure 
necessary to complete the fabric of social provision, 
the foundations of which have already been laid, no 
small part of the ill-health which harasses common 
men and their families to-day can be exorcized as 
completely as leprosy — ^as much of it, in fact, so 
far as a favoured minority is concerned, already has 
been. Tuberculosis, which there is reason to regard 
as in a special sense a disease of poverty, accounted 
recently for about 9 per cent, of the deaths regis- 
tered from all causes; and tuberculosis. Sir Arthur 
Newsholme states, is ^^a completely preventable 
disease”, though, he feels obliged to add, our 
attempts to prevent it are still ^^half-hearted and 
partial”. Maternity is a normal function, and most 
children, it appears, are born healthy. If a sixth of 
the children who enter the elementary schools at 
the age of five are suffering from physical defects, and 
maternal mortality reaches what Sir Arthur News- 
holme calls the ‘‘scandalous” figure of “three, in 
some parts four, or even six” deaths “for every 
thousand infants born alive”, the reason is not in 
nature, but in ourselves.^ 

It is idle to cope with effects while ignoring 
causes. When the measures emphasized year by year 
by the Chief Medical Officer have been carried 
out — ^when, for example, there is adequate provision 
for care of the expectant mother, for nursery 
schools and open-air schools, school feeding and the 
medical treatment of children, for the necessary 
hospital accommodation and the establishment 
everywhere of the full-time medical service whose 
necessity he emphasizes — the need for a drastic 
reconstruction of the environment will still remain. 
Health, it has been shown, is largely dependent on 



170 THE STRATEGY OF EQUALITY 

housing, and the causes of overcrowding, which, by 
general consent, is the central problem, are not 
recondite. It is a form of under-consumption 
induced by poverty. Families with the income of 
most unskilled workers go short of house-room for 
the same reason that they go short of everything 
else: they cannot afford it. In such circumstances 
the appropriate remedy is that which was applied 
when the lack of sewers and drains produced cholera 
and typhus. It is to make the provision of the 
indispensable minimum of housing a public obliga- 
tion, borne, like other indispensable burdens, from 
public funds. 

It is precisely, of course, the practical acceptance 
of that principle — the fact that, of the houses built 
between 1924 and the present day, a large proportion 
were built with the assistance of the State — ^which is 
responsible for such successes as have been achieved 
by the housing policy of the past ten years. It was 
stated by Sir Ernest Simon nearly a decade ago that 
“a family of children growing up in any of the 
million new houses” built since the war had “as 
good a chance of health and strength as the child 
of a millionaire”. That result, in so far as it existed, 
was to be ascribed primarily to the partial and 
reluctant communalizing of the service concerned. 
Nor will it be possible in the future, it may be 
prophesied, for the State to confine its liability to 
the payment of subsidies in aid of building. The 
rent at which a house of the cheapest kind tolerable 
could be let was in excess, he proved, of that which 
could be paid by the parents of three children, or 
more, with an income of less than £3 a week, with 
the result that there were in urban areas some 
800,000 households, with approximately 2,000,000 



EXTENSION OF THE SOCIAL SERVICES 171 

children, ^Vho are to-day being brought up in 
conditions where health and full mental and bodily 
development are totally impossible’ \ If tolerable 
housing is to be secured by the lower-paid workers, 
it will be necessary, he rightly urged, to extend 
financial assistance from the provision of accommo- 
dation to the subsidizing of rents. It will be 
necessary, in short, to fix a standard house, and to 
pay children’s rent allowances for families with three 
children or more whose income is less than ^3 a 
week.^ 

When clever people, therefore, dismiss the idea 
of equality as monstrous and visionary, we may 
comfort ourselves with the thought that there is 
one humble aspect of it which, though still far from 
being realized, is capable of realization. It is possible, 
those best qualified to judge assure us, to equalize, 
if we please, the external conditions which are 
necessary for health. And, starting from that 
prosaic, commonplace foundation, we may ask a 
further question. If it is practicable to equalize 
the conditions required for physical development, 
may it not be practicable also to equalize those 
needed for mental development? If it is possible to 
secure to all, not equal health, but an environment 
equally favourable to its preservation, may it not be 
possible also to secure them, not indeed equal 
culture or intellectual attainments, but equal 
opportunities of cultivating the powers with which 
Nature has endowed them? 

Whatever the subtleties of educational science 
and the refinements of the teacher’s art, the funda- 
mental aim of education is not difficult to state. 
It is simple, because the needs which it is designed 
to meet have themselves a terrible simplicity. 



172 


THE STRATEGY OF EQUALITY 


Every year a new race of some 600,000 souls slips 
quietly into the United Kingdom. About one in 
eighteen dies within a year. The business of the 
survivors is first to live and then to grow. The 
purpose of the educationalist is to aid their growth. 
It should be easy to regard them, not as employers 
and workmen, or masters and servants, or rich and 
poor, but merely as human beings. Here, if anywhere, 
the spirit of equality might be expected to establish 
its kingdom. Here, if anywhere, it should be possible 
to forget the tedious vulgarities of income and 
social position, in a common affection for the 
qualities which belong, not to any class or profession 
of men, but to man himself, and in a common 
attempt to improve them by cultivation. 

It should be possible. And, if that simple possi- 
bility still eludes our grasp, it is not circumstances, 
but ourselves, that must bear the blame. To set the 
realities of child-life in the centre of the stage as the 
criterion by which all educational arrangements are 
to be tested; to adapt educational organization, 
not to social conventions or economic convenience, 
but to the requirements of the children themselves; 
to be sensitive to the varying needs of different 
individuals, and merciless to the pretensions of 
different classes — such has been, for a generation, 
the teaching of educationalists. What prevents our 
obeying it is a defect, partly of our minds, but still 
more of our hearts. It is the barbarous association of 
differences of educational opportunity with distinc- 
tions of wealth and social position. It is the habit of 
treating the public educational system as a matter of 
secondary importance, which that association inevit- 
ably produces. It is the refusal, as a consequence, 
to introduce into it the improvements which all 



EXTENSION OF THE SOCIAL SERVICES 173 

practical educationalists know to be long overdue, 
as though common children were lucky to be offered 
any education at all, and could not reasonably expect 
to enjoy the same range and quality of opportunities 
as their betters. 

The hereditary curse upon English education is 
its organisation upon lines of social class. ‘^An 
elementary school education’’, remarked recently 
an experienced educational administrator, ‘‘has 
always meant, and still means, a cheap education. 
An elementary school text-book means a cheap book, 
which is carefully adapted in language and content 
to a wholly derogatory estimate of the needs and 
powers of the children of a certain section of society, 
who are supposed not to require or to be capable 
of the same kind of education as the children of 
parents who have more money.”^ The effect of the 
conditions as to staffing and accommodation still 
permitted to continue in many primary schools is 
not merely to cripple the performance of the vital 
and delicate task on which these schools are en- 
gaged. It is to poison their soul. It is to cause, not 
only their external organization, but their spirit 
and temper to be smitten by a blight of social 
inferiority. 

Children are apt to think of themselves as their 
elders show that they think of them. The public 
school boy is encouraged to regard himself as one 
of a ruling class, which in politics, administration 
and business will govern and direct — to acquire, 
in short, the aristocratic virtues of initiative and 
self-reliance, as well as frequently the aristocratic 
vices of arrogance, intellectual laziness and self- 
satisfaction. The age of spiritual bobbing and 
curtseying in public education is, happily, over. 



•74 


THE STRATEGY OF EQUALITY 


The elementary schools, with all their defects, 
have done more than any other institution to 
straighten the backs of the mass of the population. 
But, while the theory that the standards permissible 
in elementary schools ought to be inferior, because 
they are designed for a class which is inferior, is, 
if not dead, at any rate dying, the fact of their 
inferiority is only too alive. If the elementary 
school boy is no longer taught by his masters that 
the world has been divided by Providence into the 
rich, who are the ends of civilization, and the poor, 
who are its instruments, he is frequently taught a 
not very different lesson by the character of the 
surroundings which his countrymen provide for him. 

He is taught it by mean, and in some cases even 
unhealthy, buildings; by the deficiency of playing- 
fields, school libraries, laboratories, and facilities 
for practical work; by -the shortage of books them- 
selves and the parsimony which holds that less than 
2s. a year for each pupil is enough to spend on 
them.^* He is taught it by the persistent under- 
staffing which still permits the existence of 46,000 
classes with over forty pupils on the register, and 
actually over 3,000 classes with more than fifty. 
He is taught it by his premature plunge into wage- 
earning employment and the conditions that he 
meets there. He is taught it by recurrent gusts of 
educational economy, with their ostentatious in- 
sistence that it is his happiness and his welfare- 
which, when the ship is labouring, are the super- 
fluity to be jettisoned. He is taught it by the naive 
assurance with which his masters, unenlightened 
by a century of experience, persist in asserting that 
they cannot dispense with his immature labour, as 
though, while their own children continue their 



EXTENSION OF THE SOCIAL SERVICES 175 

education to sixteen or twenty, he and his kind 
were predestined by Providence to be the cannon- 
fodder of industry. He is taught it, not least, by the 
very tenor of the proposals which are applauded as 
impressive reforms by his well-wishers themselves. 

For consider the assumptions implied in the 
view hitherto held of the scope and purpose of 
secondary education. When the boys and girls of 
well-to-do parents attain the great age of thirteen 
to fourteen, no one asks whether — absurd phrase — 
they are ‘^capable of profiting^^ by further education. 
They continue their education as a matter of course, 
not because they are exceptional, but because 
they are normal, and the question of the “profit” 
which they succeed in deriving from it is left, 
quite rightly, to be answered later. Working-class 
children have the same needs to be met, and the 
same powers to be developed. But their oppor- 
tunities of developing them are rationed, like bread 
in a famine, under stringent precautions, as though, 
were secondary education made too accessible, the 
world would end — as it is possible, indeed, that 
one sort of world might. 

Public opinion is so saturated with the influence 
of a long tradition of educational inequality, so 
wedded to the idea that what is obtained by one 
class without question must be conceded to another 
only on proof of special capacity, that eminent 
personages can still sometimes be heard to con- 
gratulate the nation on the existence of what they 
describe as an educational ladder, which has as 
its effect that less than one child in seven of those 
leaving the elementary schools wins access, after 
being strained at eleven through the sieve of a 
competitive examination, to the secondary education 

G 



176 THE STRATEGY OF EQUALITY 

that the children of the rich receive, in most cases, 
as a matter of course. And, now that the Consulta- 
tive Committee of the Board of Education, by 
insisting that all children, and not merely a minority, 
should receive secondary education, has killed one 
embodiment of that nauseous creed, another, and 
not less nauseating, embodiment of it appears to 
be on the verge of starting to life. For, in defiance 
of the Committee’s report, schools are being 
established in more than one area, which, if post- 
primary in name, in staffing, equipment and 
accommodation differ but little from the elementary 
schools whose place they are designed to take. 
Not only so, but the recommendation that all 
children should be retained at school till fifteen, 
which formed an essential part of the Committee’s 
policy, and the neglect of which for a decade has 
largely stultified the remainder of their plan, has 
now been summarily rejected by the Government. 
“The small fingers” of children of fourteen, we 
were told by a speaker in the House of Commons 
on the Bill of 1936, are indispensable to the survival 
of the Yorkshire textile industry.^’ The children of 
the rich, in addition to their other advantages, are 
apparently blessed by Providence vnth fingers 
plumper and more elongated than those bestowed 
on the wretched brats whose parents happen to be 
poor. 

When the ground is littered with the remains of’ 
an obsolete social tradition, which starves the 
majority of children, and pampers a small minority, 
what surer way can be found of burying the thing 
decently than to let the young know that, in the 
eyes of all sensible people, it is already dead ? The 
English educational system will never be one worthy 



EXTENSION OF THE SOCIAL SERVICES 177 

of a civilized society until the children of all classes 
in the nation attend the same schools. Indeed, 
while it continues to be muddied by our absurd 
social vanities, it will never even be efficient as an 
educational system. The capital fact about English 
educational policy is that hitherto it has been made, 
except at brief intervals, by men few, if any, of 
whom have themselves attended the schools 
principally affected by it, or would dream of 
allowing their children to attend them. In such 
circumstances, it is not surprising that they should 
grudge expenditure upon it. Rightly regarded, the 
preparation of the young life is obviously the 
greatest of common interests. As long as the 
character of educational organization is determined, 
not by the requirements of the young, but by the 
facts of the class system, it is impossible for that 
truism to receive recognition. 

The goal to be aimed at is simplicity itself. 
The idea that differences of educational opportunity 
among children should depend upon differences of 
wealth among parents is a barbarity. It is as 
grotesque and repulsive as to suppose that the 
latter should result, as once they did, in differences 
of personal security and legal status. The primary 
school, as the Consultative Committee of the 
Board of Education asserted in its report on the 
subject, should be, as in some countries it already is, 
“the common school of the whole population, so 
excellent and so generally esteemed that all parents 
desire their children to attend it”.^ It should, in 
short, be the preparatory school, from which all 
children, and not merely a fortunate minority, pass 
on to secondary education, and which, since the 
second stage would then succeed the first, as a 



178 THE STRATEGY OF EQUALITY 

matter of course, when children were ripe for it, 
would be free from the present pressure to prepare 
them for a competitive examination affecting their 
whole future. A special system of schools, reserved 
for children whose parents have larger bank-accounts 
than their neighbours, exists in no other country 
on the same scale as in England. It is at once an 
educational monstrosity and a grave national mis- 
fortune. It is educationally vicious, since to mix 
with companions from homes of different types is 
an important part of the education of the young. 
It is socially disastrous, for it does more than any 
other single cause, except capitalism itself, to 
perpetuate the division of the nation into classes of 
which one is almost unintelligible to the other. 
All private schools, including those so-called “public 
schools”, should be required, as a condition of their 
continuance or establishment, to hold a licence 
from the Board of Education. Such a licence should 
be granted to a school only on condition that its 
governing body is representative, that its endow- 
ments are administered in the general interest, and 
that it is equally accessible to all children qualified 
to profit by it, irrespective of the income or social 
position of their parents. 

A spendthrift’s utopia or a hell of mediocrity ? 
Is the alternative, then, so practical and inspiring? 
As a society sows, so in the long run it reaps. If its 
schools are sordid, will its life be generous? Will it 
later unite by an appeal to economic interests those 
whom in nurture and education it has taken pains 
to put asunder? If it sacrifices its children to its 
social conventions and its economic convenience, 
is it probable that, when men, they will regard 
it with affection? Apart from such considerations. 



EXTENSION OF THE SOCIAL SERVICES 179 

the mere economic loss involved in withholding 
from four-fifths of British children the educational 
opportunities required to develop their powers is 
extremely serious. The nation has not such a 
plethora of ability at its command that it can 
afFord to leave uncultivated, or under-cultivated, the 
larger proportion of that which it possesses. The 
principle to be followed is, after all, simple. What a 
wise parent would desire for his own children, that 
a nation, in so far as it is wise, must desire for all 
children. Educational equality consists in securing 
it for them. It is to be achieved in school, as it is 
achieved in the home, by recognizing that there are 
diversities of gifts, which require for their develop- 
ment diversities of treatment. Its aim will be to do 
justice to all, by providing facilities which are at 
once various in type and equal in quality. 

It should be needless to rehearse once more the 
familiar catalogue, every item of which has been 
thrashed bare in the last ten years, of the measures 
required to create the mere skeleton and mechanism 
into which the spirit may later breathe life. The 
establishment of open-air nursery schools in all 
urban areas, the development of the school medical 
service, and the general establishment of a proper 
system of school meals; the staffing and equipment 
of primary schools on a scale which may make 
possible initiative and experiment, a large measure 
of practical work, and an atmosphere of freedom 
and humanity; the provision of different kinds of 
secondary education, not merely in name, but in 
fact, for all children from eleven to sixteen, and 
the retention of all children at school to that age; 
the abolition of the ridiculous distinction between 
schools which are secondary and schools which are 



i8o THE STRATEGY OF EQUALITY 

merely post-primary, and the amendment of the 
Board’s regulations in such a way as to establish 
common standards of staffing and equipment for all; 
the abolition of fees at grant-aided secondary schools, 
and the creation of a system of maintenance 
allowances on a scale sufficiently ample to break the 
vicious circle which binds poverty in one generation 
to lack of educational opportunity in the next; 
the removal of the absurd barriers which at present 
divide different branches of the teaching profession, 
and the general recognition that the provision of a 
liberal education for the future primary teacher is 
among the most vital of a university’s functions — 
these things are all commonplaces. What trifles to 
advance as a contribution to equality, and through 
what a den of lions the humblest of them must be 
dragged! A blink, a yawn, a growl, a heavy plutocratic 
paw, and the most timid of improvements fluttering 
in tatters! How few have escaped the majestic 
creature since 1918! 

If the first use which a sensible society will make 
of its surplus is to raise the general standard of 
health, and the second to equalize educational 
opportunities, the third is not less obvious. It is 
to provide for the contingencies of life, and thus to 
mitigate the insecurity which is the most character- 
istic of the wage-earner’s disabilities. The extension 
of such provision is the most novel departure in 
social policy made in the present century. Almost 
everywhere it was assumed even as recently as a 
generation ago that, apart from the relief of persons 
in actual destitution, the whole costs of sickness, 
old age and unemployment should be met by the 
individual from his personal savings or the earnings 
of his relatives. To-day, while, in England, at least. 



EXTENSION OF THE SOCIAL SERVICES i8i 

the amount of such savings has grown considerably, 
some form of collective provision is increasingly the 
rule. Since 1900 some sixteen European nations and 
four of the British Dominions have established 
systems of old-age pensions, defrayed from public 
funds, or by means of insurance, or by a combination 
of both, while America is moving in the same 
direction. Though state-aided insurance against 
sickness, invalidity and unemployment is somewhat 
less general, it advances year by year. 

Contrasts of economic security, involving, as 
they do, that, while some groups can organize their 
lives on a settled plan with a reasonable confidence 
that the plan will be carried out, others live from 
year to year, week to week, or even day to day, are 
even more fundamental than contrasts of income. 
The growth of what Dr. Dalton has happily called 
income from civil rights,®* by supplying the buffer 
which, in a different stage of social development, 
was offered by the existence of numerous humble 
properties, has an effect in mitigating disparities 
of condition which is out of all proportion to the 
expenditure involved. Instead of being regarded as 
in the nature of an exceptional concession to 
abnormal distress, which carries with it a faint odour 
of charity or patronage, and is tolerable only if 
confined within the narrowest limits, it should be 
prized as a vital element in national well-being, 
which, in the public interest, it is desirable to make 
as adequate as the resources of the nation at any 
time allow. 

It should be adequate in amount, but its use should 
be discriminating, and, the more it increases, the 
greater the need for discrimination becomes. For 
the risks of life are of various kinds, and, if social 



i8» THE STRATEGY OF EQUALITY 

provision is to be applied on the necessary scale to 
the purposes for which it is appropriate, it must not 
be lavished on those which, however urgent in 
themselves, require treatment of a diflferent type. 
The limit to its extension is obvious. It is drawn 
at the point where measures to protect the individual 
from being crushed by a contingency, when it 
occurs, become liable to be used by the State as a 
lazy substitute for the attempt to prevent the 
contingency from occurring. In the case of provision 
for old age that risk does not arise; no one can skip a 
decade to obtain a pension. In the case of sickness, it 
is not acute: if much preventable disease is still 
unprevented, the reason is the cost of removing its 
causes, not the fear that, by doing so, independence 
will be undermined. Unemployment stands in a 
different category. The reason is not the occurrence 
of individual malpractices, which are statistically 
unimportant.*® It is the danger of encouraging what 
may be described, perhaps, as social malingering. 
It is the disposition of the governing classes to rely on 
drugs, when the remedy needed is a drastic change 
of regimen. 

That has been, and remains, the policy of capitalist 
governments. Since they dare not deal with the 
causes of unemployment, what they do is to pay 
the unemployed to starve quietly. The detestable 
family means test, which is a device for financing 
part of the maintenance of the unemployed from 
the pockets, not of the rich, but of the poor, is 
typical of that attitude. Clearly, since unemploy- 
ment is the result of a social breakdown, society 
must pay for it. Clearly, again, since the maintenance 
of the willing worker is a matter of right, not of 
grace, the sum paid must be sufficient, not merely to 



EXTENSION OF THE SOCIAL SERVICES 183 

keep him in physical existence, but for a self- 
respecting life. The central problem of unemploy- 
ment, however, is obviously different. It lies in the 
region of financial and industrial policy, with which 
the social services are not directly concerned. 

The requirements for which the expansion of 
the latter is the appropriate provision are of a 
different kind. They are those of infancy and 
childhood, sickness and old age — provision for the 
needs of mothers and young children; school 
meals and medical care, the cost of all such incidentals 
as books and clothing, and a system of maintenance 
allowances, graduated with age; the removal of 
anomalies in the existing system of health insurance, 
an increase in the rates of sickness benefit, the 
payment of allowances to the dependents of insured 
persons incapable of work, with the extension to 
them of medical benefits, and a medical service 
which makes doctors and hospitals as universally 
available as teachers and schools; a lowering of the 
age at which pensions are payable to the old and an 
increase in the amount of the pension. Among 
non-contributory pension schemes, analogous to 
that established in Great Britain in 1908, the 
Australian system provides for pensions to begin at 
sixty-five for men and sixty for women, as against 
seventy in Great Britain; contributory pensions, 
which begin in the latter, under the Act of 1926, 
at sixty-five, are payable in France, Russia and 
Bulgaria at sixty; while, in France, pensions at a 
reduced rate can be received at fifty-five. It may be 
observed that, though only one country makes the 
cessation of work a condition of securing a pension, 
continental opinion appears to favour the view that 
to offer inducements to aged workers to retire from 



i84 the strategy OF EQUALITY 

industry has the incidental advantage of mitigating 
unemployment. 


(iv) 

The Lion in the Path 

If every individual were reared in conditions as 
favourable to health as science can make them, 
received an equally thorough and stimulating 
education up to sixteen, and knew on reaching 
manhood that, given a reasonable measure of hard 
work and good fortune, he and his family could face 
the risks of life without being crushed by them, the 
most shocking of existing inequalities would be on 
the way to disappear. Sharp contrasts of pecuniary 
income might indeed remain, as long as society 
were too imperfectly civilized to put an end to 
them. But the range of life corrupted by their 
influence would be narrower than to-day. It would 
cease to be the rule for the rich to be rewarded, 
not only with riches, but with a preferential share 
of health and life, and for the penalty of the poor 
to be not merely poverty, but ignorance, sickness, 
and premature death. 

In reality, however, even inequalities of income 
would not continue in such conditions to be, either 
in magnitude or kind, what they are at present. 
They would be diminished both directly and 
indirectly — as a result of the diminution of large 
incomes by means of taxation, and through the 
removal of special advantages and adventitious 
disabilities arising from the unequal pressure of the 
social environment. Inherited wealth, in particular, 
would lose most of the importance which it has 



THE LION IN THE PATH jgj 

to-day. At present, when — after the payment of 
death duties — ^more than ,^400 millions pass by 
way of inheritance, its influence as a cause of social 
stratification remains overwhelming. It results, 
not merely in capricious disparities of fortune 
between individuals, but in the “hereditary in- 
equality of economic status” between different 
classes described by Mr. Wedgwood. If the estate 
duties were increased, part of them required to be 
paid in land or securities, and a supplementary duty 
imposed, increasing with the number of times 
that a property passed at death, in accordance 
with the proposal of Rignano or with the modified 
version of it suggested by Dr. Dalton, the social 
poison of inheritance would largely be neutralized. 
As the privileges conferred by it became a thing 
of the past, and the surplus elements in incomes 
were increasingly devoted to public purposes, while 
the means of health and education were equally 
diffused throughout the whole community, “the 
career open to talent”, which to-day is a sham, 
would become a reality. The element of monopoly, 
which necessarily exists when certain groups have 
easier access than others to highly paid occupations, 
would be weakened, and the horizontal stratification, 
which is so characteristic a feature of English society, 
would be undermined. While diversities of income, 
corresponding to varieties of function and capacity, 
would survive, they would neither be heightened by 
capricious inequalities of circumstances and oppor- 
tunity, nor perpetuated from generation to genera- 
tion by the institution of inheritance. Differences 
of remuneration between different individuals might 
remain; contrasts between the civilization of different 
classes would vanish. 



i86 THE STRATEGY OF EQUALITY 

The psychological reactions of such a change, if 
more gradual than its immediate economic effects, 
would be even more profound. The most singular 
phenomena can be made to pass unchallenged, 
provided that the minds of observers have been 
tuned to regard them as inevitable and edifying. 
As, with the extension of the services of health and 
education, the majority of the population cease to 
be familiarized with squalor in infancy, and to be 
broken in to the machine while still docile and 
malleable, and to be taught to know their place 
before they are given a chance of knowing anything 
else, the sense of inferiority which has paralysed 
them in the past will increasingly be dissipated. 
Having seen inequalities, long declared unalterable, 
yield to social intervention, they will be less 
indulgent in the future to those which remain, 
and less easily duped, it may reasonably be hoped, 
by the technique which defends them. 

In the conditions created by political democracy 
that technique is simple. Given five fat sheep and 
ninety-five thin, how induce the ninety-five to resign 
to the five the richest pasture and shadiest corners? 
By convincing them, obviously, that, if they do not, 
they will die of rot, be eaten by wolves, and be 
deprived in the meantime of such pasture as they 
have. Nor, indeed, has it hitherto been difficult to 
convince them, for there is nothing which frightens 
thin sheep like the fear of being thinner. Measures 
— so the argument runs — ^which have as their object 
the diminution of inequality, have as their effect 
the depletion of capital and the discouragement of 
enterprise. Their ultimate victims are not those 
on whom taxation is levied, but those for whose 
benefit it is imposed. The latter lose as workers what 



THE LION IN THE PATH 187 

they gain as citizens, and pay for illusory improve- 
ments in their social conditions in the hard cash of 
lower wages and increased unemployment. Thus 
the wealth of the few is the indispensable safeguard 
for the modest comfort of the many, who, if they 
understood their own interests, would not harass 
the rich with surtaxes and death duties, but would 
cherish and protect them. They would applaud the 
display which proved their affluence with the same 
eager satisfaction as the Roman augurs felt when they 
observed that the sacred chickens had made a hearty 
meal. The fatter the fowls, the safer the republic. 

Of the annual output of wealth, part is used for 
current consumption by the individuals receiving 
it; part is put at the disposal of industry and trade; 
part is paid to the State and used for the mainten- 
ance of the public services. A society may obviously 
spend too little of its income on any one of these 
purposes, and too much on any other; or, while 
spending the right proportion on each, it may 
spend it unintelligently. The view which it takes of 
the proper allocation of its resources between them 
is the result, partly, no doubt, of custom and con- 
vention. Because the taxpayer cries out, it does not 
follow that the nation is being hurt, or it would have 
perished long ago. Few to-day, for example, would 
endorse the view, so freely expressed between 1906 
and 1912 in parliamentary debates, that an income 
tax of IS. was a ‘Very dangerous departure”, which 
“abolished the reserve fund of the country”, and 
that an estate duty rising to a maximum of 15 per 
cent, would cause “a very considerable depletion 
of capital”.®^ But, though the psychological limits 
of taxation are much more elastic than is commonly 
supposed, the fact that the general interest requires 



i88 THE STRATEGY OF EQUALITY 

some minimum sum at least to be devoted to each 
of these three purposes is self-evident. Those who 
think that much public expenditure is unnecessary 
or mischievous do not propose for that reason to 
abolish the police. Those who think that much of 
it is highly beneficial are not unaware of the 
importance of improving the equipment of coal- 
mines and cotton-mills. 

The complaint that economic progress is impeded 
by taxation may convey either of two suggestions. 
It may refer to the effect of taxation on the applica- 
tion of a nation’s aggregate resources to its different 
requirements, and state that it results in a less 
economical use of them than would otherwise be 
the case, for example, by causing wealth that should 
be employed as capital to be spent on current 
account. Or it may relate to the effect of taxation 
on the behaviour of individuals, and argue that, 
even if otherwise advantageous, it produces injurious 
reactions, for example, by encouraging evasion or 
the removal of their property and themselves to 
less exacting states. The suggestion that Great 
Britain is overtaxed in the first sense is unconvincing. 
A man may reasonably argue, perhaps, that he 
cannot afford to pay his doctor’s bills or educate 
his family, if he has cut his personal expenses to the 
bone. But, if he lets his wife die of neglect and keeps 
his children on short rations in the coal-hole, while 
doing himself well in wine and cigars, what requires 
attention is not his economic condition, but his 
state of mind. The dilemma which suggests that the 
nation must choose between starving industry of 
capital and starving its citizens of health and 
education might be plausible if the requirements of 
the former could be met only by curtailing expendi- 



THELIONINTHEPATH 1*9 

ture on the latter. But, when large sums are spent 
on neither, it is obviously fallacious, until they have 
been shown to be devoted to objects more important 
than both. 

Hence, even if the conclusion of the Colwyn 
Committee, that the “provision of capital ... is 
not imperilled by the present scale of direct taxa- 
tion”,®^ be dismissed as erroneous or out of date, 
it by no means follows that the most judicious 
method of making capital available is to check 
the expansion of the social services. Before re- 
modelling its budget, a prudent community, like 
a prudent individual, will consider the com- 
parative importance of the items in it. It will 
review its investments and reflect whether it is 
reasonable to complain of a shortage of funds 
for reorganizing essential industries, when they are 
found without difficulty for breweries and cinemas 
— not to mention Mr. Hatry — ^at home, and for 
rubber plantations and oil wells abroad. It will 
review its private expenditure on current needs, and 
will consider whether it can at once be so rich as to 
have wealth to spare, to the extent of 50,000,000 
a year for drink alone, not to mention such un- 
considered trifles as deer forests, grouse moors, 
salmon rivers, fox-hunting, villas in the south of 
France and yachts in the Mediterranean — and so 
poor as to be unable to afford decent homes for its 
citizens and better schools for its children. It will 
review its public expenditure, and inquire whether 
the certain gain to its prosperity purchased by 
spending twenty millions more on health and 
education may not outweigh the risk of loss to its 
security — ^if it is, indeed, a loss — involved in 
spending twenty millions less on armaments. 



190 THE STRATEGY OF EQUALITY 

When it makes such a survey, it may not change 
its heart, but it will clarify its head. It may decide 
that it prefers not to spend more on mitigating 
inequality, but it will discover that it is estopped 
from pleading that it is unable to spend it, since it is 
already spending largely on objects whose superior 
urgency is, at least, not self-evident. It may even, 
as it pushes its investigations farther, come reluc- 
tantly to realize that some forms of expenditure, 
which it has regarded as assets, are, in fact, liabilities, 
and others, which it regarded as liabilities, are in 
reality assets. For the effect of taxation, if the truism 
may be excused, does not depend merely upon the 
amounts which are raised; it depends not less upon 
the manner in which they are spent. No serious 
student of finance has ever supposed that the effect 
of spending £100,000,000 on armaments is the 
same as that of spending the same sum in paying 
off part of the national debt. The suggestion that 
it is identical with that of spending it on health 
and education is equally remote from practical 
realities. 

To deplore the cost of these services, without 
weighing the return which they yield, is not more 
rational than to judge the position of a firm by 
looking at one side of its balance-sheet without 
considering the other. The doctrine which appears 
to make so irresistible an appeal to the business 
world that it may be described, perhaps, as the 
business man’s fallacy — the doctrine that every 
additional million of social expenditure is an 
additional “burden on industry” — may have pos- 
sessed a certain plausibility in the days when the sole 
activities of the State were the maintenance of 
police and military forces. But, in the light of the 



THE LION IN THE PATH 


191 

facts of to-day, it is an antiquated superstition, to 
which no reputable economist would lend his 
endorsement. 

To the question whether the taxable capacity of 
the country is in danger of being exceeded, the 
reply of the majority of them would probably be 
that given some years ago by Sir Josiah Stamp to 
the Economic Section of the British Association: 
“There can be no absolute answer, because it 
depends upon the reason for, or subjects upon, which 
the money is to be spent. Expenditure, in short, 
is neither more nor less onerous when the sums 
required are collected and spent by public authorities 
than when it is incurred by private individuals on 
their own account. Whether the pen be wielded by 
the blameless fingers of the company promoter or 
by the furtive paw of the government official, the 
account on which the cheque is drawn is the same. 
It is the annual output of goods and services which 
together constitute the national income. The 
question of the degree to which expenditure can 
properly be described as a “burden” is to be decided 
by considering, not who spends it, but how it is spent. 

The problem before a society which desires to 
turn its income to the best account does not differ, 
therefore, save in magnitude, from that confronting 
a private individual. What concerns it is not to 
maintain any fixed proportion between private and 
public expenditure, but to ensure that its limited 
resources shall be applied, not capriciously, but to 
meet its requirements in the order of their relative 
urgency. It is to reduce expenditure which neither 
raises the quality of individual life nor promotes 
social efficiency, and to augment expenditure 
which heightens them. 



I9I THE STRATEGY OF EQUALITY 

In reality, of course, the greater part of the 
expenditure upon the social services is not a liability, 
but an investment, the dividends of which are not the 
less substantial because they are paid, not in cash, 
but in strengthened individual energies and an 
increased capacity for co-operative effort. The 
manufacturer or mine-owner, whose establishment 
is staffed with workers who, after being prevented 
from dying in infancy by the public health service, 
educated in public elementary schools, and taught 
their craft in the municipal college of technology, 
are housed in buildings erected with the aid of a 
subsidy from the State, maintained during sickness 
and unemployment from funds to which it contri- 
butes, and paid their old-age pensions through the 
Post Office when they can no longer be useful to him, 
may continue to believe, with the romanticism of his 
kind, that his profits are created solely by his personal 
intelligence, initiative, thrift, and foresight. But, as 
a mere matter of prosaic fact, the State is a partner 
in his enterprise, whose contribution to its success 
is at least as important as his own. It is able to take 
for social purposes part of the wealth which he, as 
he thinks, produces, because it plays itself, through 
the social services, no small part in producing it. 

The verdict on the subject given by Professor 
Pigou lends little encouragement to those who think 
that the nation is crippled by expenditure on its 
social services. His policy, he writes in his latest 
work, would be to “use the weapon of graduated 
death duties and graduated income-tax, not merely 
as instruments of revenue, but with the deliberate 
purpose of diminishing the glaring inequalities of 
fortune and opportunity which deface our present 
civilization. He would take a leaf from the book of 



THE LION IN THE PATH 193 

Soviet Russia and remember that the most important 
investment of all is investment in the health, 
intelligence and character of the people. To advocate 
‘economy’ in this field would, under his Govern- 
ment, be a criminal offence”.®* The truth is, as he 
implies, that, if economies are desired, none are so 
certain or far-reaching as those which can be 
effected through the further extension of the 
services in question. The working days lost in 1933, 
among the insured population only, through sickness, 
much of which was unnecessary, were equivalent, the 
Chief Medical Officer of the Ministry of Health told 
us, to twelve months’ work of nearly 560,000 
persons; while the annual cost to a nation of prevent- 
able sickness has been put by Dr. Fremantle at 

1 00,000,000.®® What is true of health is equally true 
of education, which itself, after all, is little more 
recondite than the promotion of health by a special 
technique, designed for the distinctive needs of 
children and adolescents. Every child whose physique 
is injured by a noxious environment, by the absence 
of nursery schools, or by the failure to provide early 
and suitable treatment for it, or whose mental 
development is arrested because it is prematurely 
snatched from school, represents, not an economy, 
but the most stupid, as well as the most cruel, of 
extravagances. It is possible for the personnel, as well 
as for the material equipment, of industry to be 
under-capitalized. A nation which has the intelli- 
gence to invest generously in the cultivation of 
human capacity “saves”, in the strictest sense, more 
“capital” than the most parsimonious community 
that ever lived with its eyes on the stock exchange. 

Granted, however, it may be argued, that 
expenditure on health and education is to be 



194 the strategy OF EQUALITY 

regarded as an investment, yet resources are limited, 
and not all investments, however excellent in 
themselves, are of a kind that can be afforded. The 
age when such services were in their infancy and 
taxation was light — the age when the question was 
not whether there was a risk of capital being 
depleted, but whether even the scantiest provision 
would be made for essential social requirements — 
has now ended. Is not the time approaching when 
the situation will be reversed, and when the most 
urgent need will be, not to spend more liberally on 
social requirements, but to secure that the resources 
needed for the development of industry are preserved 
intact? 

If the present application of the nation’s income 
may be taken as an index, that time is still remote. 
No serious evidence has been adduced to prove that 
industry is at present hampered by a shortage of 
capital. If, however, the danger of trenching on 
capital exists, the safeguard is simple. It is that the 
State should concern itself more directly with 
questions of saving and investment than it has 
hitherto. In the past it avoided the risk that capital 
might be depleted by the social services by starving 
the latter; it left ‘‘saving” — to quote the Colwyn 
Committee — “as a monopoly in the hands of the 
wealthier classes, who were allowed to remain in 
almost complete control of their riches”.^ In the 
future that alternative, which in any case is ruinous, 
will not be open to it. It will find it necessary, 
therefore, instead of trusting to the chances of the 
market, to take deliberate action to determine more 
precisely the proper division of its available resources 
between present social requirements and the claims 
of future productive efficiency. It has been turned in 



THE LION IN THE PATH 


•95 

a generation from a niggard to a spender. Having 
learned to spend, it must now learn to save. 

When the spokesmen of business warn the nation 
against making inroads on capital by excessive 
taxation, they are urging, in effect, that part of the 
proceeds of industry should be regarded as trust 
funds, which are earmarked for the purpose of 
economic development. The considerations which 
they emphasize are obviously important; but under 
existing conditions their argument is unconvincing. 
For the essence of trust funds is that they must be 
applied, not at the discretion of the trustee, but in 
accordance with the terms of the trust, and, as 
things are to-day, there is no guarantee that what 
the tax-collector spares industry will gain. There is 
no sense in putting butter down a dog’s throat 
merely on the chance that the animal will be 
sufficiently intelligent and good-natured to refrain 
from swallowing it; nor, if it is desired to increase 
the nation’s capital by £^ 0 , 000 , 000 , is a present of 
^100,000,000 to tax-payers the most economical 
method of achieving that result. If economic 
prudence requires that the resources which are 
necessary to future economic progress shall not be 
used to meet the current liabilities of the State, it 
requires no less that they shall not be spent, as they 
are largely spent when trade is prosperous, on the 
current liabilities of shareholders and their 
dependents. If business demands that its reserves 
shall be immune from the raids of the Chancellor 
of the Exchequer, it must be prepared to show that 
they will not be raided, as they frequently have been 
in the past, in order to be distributed in inflated 
dividends or bonus shares to hungry investors. 

Hence, the moral to be deduced from the obvious 



196 THE STRATEGY OF EQUALITY 

necessity of making adequate provision for new 
capital expenditure is different from that which is 
commonly drawn from it. It is not that taxation 
should be reduced, as a menace to industry; for, 
even if the reduction takes place, there is no 
security that the whole of the wealth released will 
be employed as capital, instead of being spent on 
the personal caprices of its owners; or that, if it is, 
the capital will flow into the undertakings whose 
expansion is, on public grounds, most important. It 
is, in the first place, that industry should look for 
the funds needed to finance development, less to 
the savings effected by individuals, who, when a 
windfall drops into their lap, are as likely to spend 
as to invest it, than to the accumulation of capital 
by joint-stock companies themselves; and, secondly, 
that the State should concern itself with the amount 
and direction of investment. 

The principal source from which new capital is 
provided to-day, is, not the savings made by 
individuals, but the undistributed profits of com- 
panies and firms.®’ The State can, if it pleases, 
diminish the risk — if such exists — that supplies 
may be deficient by requiring that companies 
shall follow the course of prudence, and allocate 
to reserves a proportion of their profits above a 
given standard. Nor need it stop at that. The 
direction of investments is as important as their 
amount, and should equally be the concern of 
public policy. A prudent community will not rely, 
for securing that its essential industries are 
adequately supplied with capital, on the crude, 
extravagant and uncertain device of cutting down 
its social services, and trusting to chance that the 
money saved will be used for more important objects. 



THE LION IN THE PATH 


*97 


It will follow the advice tendered to it by economists 
of unimpeachable propriety, and meet the danger 
that part of such supplies as are available may be 
wasted or misused by guiding the investments of 
capital into nationally desirable channels through 
the agency of a National Investment Board. It 
will, above all, push forward as rapidly as possible 
the transference of the major industries to public 
ownership, and thus acquire a position which will 
enable it to set aside for capital development what- 
ever sums it may from time to time consider 
expedient. 



CHAPTER V 


THE CONDITIONS OF ECONOMIC FREEDOM 


If arbitrary contrasts of circumstance and oppor- 
tunity are one form of inequality, they are not the 
only form. There is an economic, as well as a social, 
stratification; a hierarchy of industry and labour, as 
well as of leisure and enjoyment. When the in- 
justices of the second have been softened or 
abolished, it still remains to eliminate the tyranny 
of the first. 

The source of that tyranny is familiar, for it is 
forced on public attention by the continuous 
friction, and recurrent breakdowns, of the economic 
mechanism. It is inequality of power. Industrial 
society is crossed by a horizontal division, and 
organized forces are massed on each side of it. 
Sometimes they meet in open collision; more often 
they watch each other, in at least nominal peace, 
across the frontier, relying on treaties negotiated 
between them. The permanent aim of their 
organization and policy, as distinct from their 
tactical movements and immediate objectives, is to 
diminish this inequality or maintain it in existence, 
to consolidate its gains or resist encroachments 
upon it. 


(i) 


The Concentration of Economic Power 

Power is the most obvious characteristic of organized 
society, but it is also the most ambiguous. The 

198 



CONCENTRATION OF ECONOMIC POWER 199 

discussion of the problems which it presents has 
been prejudiced by the confusion of the reality 
with its forms, and by the concentration of interest 
upon certain of its manifestations to the exclusion 
of others. A realistic treatment of it has suffered, 
in particular, from the habit of considering it 
primarily, or even purely, in political terms. Power 
is identified with political power, and political power 
is treated as a category by itself. It is regarded as 
possessed by individuals as members of a state, or 
as exercised by a state on behalf of its members. 
In popular speech, a class acquires power when it 
obtains the franchise; a government is returned to 
power when it is supported by a majority of the 
House of Commons; a minister is in power while 
he retains his office, and falls from power when, 
if ever, he resigns it. In the works of political 
philosophers it is not unusual for the frontiers of the 
subject to be similarly straitened. The form into 
which their treatment of it has most commonly been 
cast is that of discussions of the nature of sovereignty. 
They have been interested in the question of the 
foundations of political authority, in the obligations 
which it imposes on citizens or subjects, and in the 
limits, if any, which exist to its exercise. 

Political authority is a genuine form of power, 
and is, both for good and evil, an important 
form. But it is one form, not the only form. To 
represent it as unique in kind and unrivalled in 
degree is to draw a picture which has little relation 
to the facts of life. In reality, it is one species of a 
larger genus. Its special characteristic is that it 
can set in motion the forces of law, so that it ceases 
to be merely a fact, and both becomes a right 
itself and confers rights on others. But, if scrofula 



zoo CONDITIONS OF ECONOMIC FREEDOM 

is not cured by the king’s touch, neither is power 
conferred by kissing the king’s hands. It is not the 
legal recognition which makes the power, but the 
power which secures the legal recognition. Recent 
political thinkers have shown that sovereignty is 
not merely the attribute of the State, but is shared, 
in different degrees, by other forms of association; 
and, if sovereignty is more extensive than the 
authority of the State, power is obviously more 
extensive than sovereignty and the rights conferred 
by it. The river exists before it is canalized so 
as to carry the barge and drive the mill. The fact 
of power exists independently of the right to power. 
Sometimes, indeed, it exists in spite of it. 

Power may be defined as the capacity of an 
individual, or group of individuals, to modify the 
conduct of other individuals or groups in the manner 
which he desires, and to prevent his own conduct 
being modified in the manner in which he does not. 
Everyone, therefore, possesses some measure of 
power, and no one possesses more than a measure of 
it. Men exercise only the power that they are allowed 
to exercise by other men, whom, when their clothes 
are off, they much resemble; so that the strong are 
rarely as powerful as they are thought by the weak, 
or the weak as powerless as they are thought by 
themselves. Its ultimate seat is — to use an un- 
fashionable word — the soul. It rests on hope and 
fear, the belief of those who submit to it that its 
agents can confer upon them benefits, from food to 
spiritual peace, and inflict evils, from hunger to 
misery of mind. Hence its foundations vary from 
age to age, with the interests which move men, and 
the aspects of life to which they attach a preponderant 
importance. It has had its source in religion, in 



CONCENTRATION OF ECONOMIC POWER 201 

military prowess and prestige, in the strength of 
professional organization, in the exclusive control 
of certain forms of knowledge and skill, such as 
those of the magician, the medicine-man, and the 
lawyer. It is thus both awful and fragile, and can 
dominate a continent, only in the end to be blown 
down by a whisper. To destroy it, nothing more is 
required than to be indifferent to its threats, and to 
prefer other goods to those which it promises. 
Nothing less, however, is required also. 

It is not the case, therefore, as is sometimes 
suggested, that all forms of power are, in the last 
resort, economic, for men are so constituted as to 
desire other than temporal goods and to fear other 
than economic evils. It is true, however, that, since 
economic interests, if not the most intense, are the 
most generally operative and continuous in their 
operation, most forms of power have economic 
roots, and produce, in turn, economic consequences. 
There are certain natural resources, certain kinds 
of property, certain types of economic organization, 
on the use of which the mass of mankind depend 
for their well-being. The masters of these resources, 
therefore, are in a position, in the absence of 
countervailing measures, to secure exceptionally 
favourable terms for themselves, and to exercise an 
unusual degree of control over the lives of their 
fellows. 

Naturally, the class which, for the time being, is 
economically preponderant tends normally to be 
that which discharges the most conspicuous public 
obligations. Naturally, it often displays the graces 
of civilization in an exceptional degree. Naturally, 
again, the relations of cause and effect are commonly 
reversed, so that it is said to exercise power because 



10* CONDITIONS OF ECONOMIC FREEDOM 

it is educated and fit to govern, not to possess culture 
and influence because its economic position has 
brought exceptional opportunities of both within 
its reach. Such phenomena may be inevitable, but 
they deserve to be scrutinized. The sage who defined 
his Utopia as a society in which any man can say to 
any other, “Go to hell”, but no man wants to say it, 
and no man need go when it is said, may have been 
crude in expression, but he was sound in substance. 
Pride and fear are the attitudes least becoming 
human beings, and a people which is a people, not 
a mob, will be intolerant of both. It will respect all 
men and feel awe of none. It will give short shrift 
to all forms of authority, whether political or 
economic, which breed arrogance in this class and 
servility in that. 

Economic power has a special significance in 
industrial societies, owing to the nature of the social 
structure that the great industry produces. In regions 
where the pattern of life is drawn by petty agri- 
culture and small-scale industry, economic interests 
may be a consuming passion, as with the peasant 
who ruins his own and his family’s health in order 
to add a few roods to his holding. But the force 
which they wield is small, since it is broken into 
fragments. It is dispersed in numerous small rivulets, 
each of which may irrigate a meadow, but which 
cannot, till collected, generate the energy to drive 
an engine. 

The influence of a spider is limited by the size 
of its web, and in such conditions economic power 
is feeble, because economic interdependence is 
slight. Its stature and rfile, in an industrial civiliza- 
tion, are obviously different. For the characteristic 
of modern industry, and of the financial arrange- 



CONCENTRATION OF ECONOMIC POWER 203 

ments associated with it, is not only that it increases, 
by its technological triumphs, man’s power over 
nature, but that, in the absence of deliberate 
restraints imposed by society, it heightens that 
of some men over others, by organizing and 
concentrating it. It normally involves a concentra- 
tion of ownership, and therefore of the rights which 
ownership confers. Its method is mass-production, 
and mass-production involves the control of large 
armies of workers, who execute, by small groups, 
who direct and plan. It makes all, or nearly all, 
types of economic activity interdependent, so that 
those who control a key service can impose their 
terms on the remainder. It increases the scale of 
enterprise, and thus increases both the number and 
length of the threads which can be manipulated by 
the staff-work of a single headquarters. 

Hence, in an industrial society, the tendency 
of economic power is not to be dispersed among 
numerous small centres of energy, but to be massed 
in blocks. It is gathered at ganglia and nerve-centres, 
whose impulse gives motion to the organism, and 
whose aberrations or inactivity smite it with 
paralysis. The number of those who take the 
decisions upon which the conduct of economic 
affairs, and, therefore, the lives of their fellow-men, 
depend is diminished; the number of those affected 
by each decision is increased. The late Dr. Rathenau 
once remarked that the economic life of Europe was 
controlled by three hundred individuals,^ and his 
picture, if overdrawn, was not wholly unveracious. 
Lord Melchett smiles, and there is sunshine in 
ten thousand homes. Mr. Morgan frowns, and the 
population of two continents is plunged in gloom. 

This concentration of initiative is the most 



204 CONDITIONS OF ECONOMIC FREEDOM 

familiar commonplace of recent economic history. 
The increase in the scale of the business unit, which 
is the simplest illustration of it, can in some countries 
be observed from decade to decade, with the aid of 
statistics grouping firms according to the personnel 
which they employ. In Germany, for example, 
which grew in a generation from a nation of 
industrial dwarfs to one of industrial giants, the 
percentage of workers employed in establishments 
with 1,000 employees or more almost doubled in the 
generation between 1882 and 1907; while, in the 
industries most typical of the new order, such 
as chemicals, the metal industries, and electrical 
engineering, it underwent a threefold, thirteen- 
fold, and, in the case of the last, which at the first 
date hardly existed, a fortyfold increase. The move- 
ment has continued since that date, the percentage 
of workers in establishments with 1,000 employees 
or more rising, for example, in mining from 52*4 
in 1907 to 71*6 in 1925, in machine-making from 
21*6 to 32-6, and in the chemical industry from 
1 8 *2 to 34’4. In the United States, where industrial 
concentration has attained the most imposing 
dimensions, the establishments with a capital of 
$1,000,000 or over formed, in 1914, 2*l per cent, 
of the total, employed 35*9 per cent, of the 
wage-earners, and produced 49*2 per cent, of the 
value of the total output. In 1925 they formed 
5*6 per cent, of the total, employed 56*8 per cent, 
of the wage-earners, and produced annually 67*6 
per cent, of the value of the output.^ 

No comparable figures are available for Great 
Britain; but it is not open to question that 
development has proceeded, though at a slower 
pace, in the same direction. In the production of 



CONCENTRATION OF ECONOMIC POWER 205 

pig-iron the capacity of each undertaking increased 
nearly threefold between 1882 and 1924, while 
between 1920 and 1928 the average output per 
furnace rose over 60 per cent., and the output per 
man over 50 per cent. Even in the coal industry, 
which is notorious for its attachment to the organiza- 
tion of a bygone era, 84 per cent, of the output was 
produced, as long ago as 1923, by 323 concerns 
employing over 1,000 workers each, and nearly 
one-fifth was produced by 57 firms.^ In engineering 
and shipbuilding, iron and steel, chemicals and 
explosives, amalgamations have produced a small 
but rapidly increasing number of giants with a 
personnel ranging from 10,000 to 40,000. In the 
railway industry, since the Act of 1921, over half a 
million workers have been employed by four 
companies. Even in the traditional citadel of 
individualism, the cotton industry, the Lancashire 
Cotton Corporation now controls a substantial 
proportion of one section of the trade; while pro- 
posals for cutting out weak competitors and 
concentrating production are received with a 
favour not accorded them in the recent past. 

Thus, while the sentiment of the business world 
remains fixed in its aversion to bureaucracy, its 
own practice and organization are increasingly 
bureaucratic. Nor, of course, is the increase in the 
dimensions of individual firms an adequate index 
of the concentration of economic control. It has been 
accompanied by the growth of different forms of 
combination, which has as its effect that industries 
are, in an increasing measure, united in practice, 
even while the businesses composing them continue 
to retain their separate identities. 

The importance of that movement on the 



2o6 CONDITIONSJOF ECONOMIC FREEDOM 

Continent, and, in particular, in Germany, has 
long been a commonplace. “In the United King- 
dom”, stated the Committee on Trusts nearly 
twenty years ago, “there is at the present time in 
every important branch of industry an increasing 
tendency to the formation of trade associations and 
combinations, having for their purpose the restric- 
tion of competition and the control of prices”. The 
same tendency is revealed in the growth of inter- 
national organizations, such as the European Steel 
Cartel, allocating an output of some 25,000,000 
tons between the producers of four countries; the 
British-American Tobacco Company, with a capital 
valued at approximately 100,000,000; and the 
International Match Corporation, with its 150 
factories and 50,000 workers in twenty-eight 
different countries. The more imposing of them 
form, like the iron, steel and coal interests of the 
Ruhr-Lorraine-Luxembourg region, or the under- 
takings formerly associated with Hugo Stinnes, or 
the “Big Five” of the American Meat Trust, with 
its five hundred subsidiary companies in South 
America, Australia, and Europe, what are, in effect, 
extra-territorial economic states, with which few 
political states dare risk a fall.^ 

Even more significant is the control by small 
groups, whether of producers or mere speculators, 
of primary products, such as rubber, oil, tin, and 
coffee; the amalgamation of financial interests, 
which in England reduced the number of joint- 
stock banks from 104 in 1890 to 18 in 1924, 84 per 
cent, of the aggregate deposit and current accounts 
being held, at the latter date, by five among them; 
and the control of the majority of the channels of 
public information by a handful of rich men, which 



LIBERTY AND EQUALITY 207 

resulted from the discovery that the trade of selling 
paper with advertisements on one side and news or 
nonsense on the other is the natural monopoly 
of the ambitious millionaire, since it requires a 
fortune to engage in it, and, as far as the millionaire 
is concerned, requires nothing else. As the scale of 
organization increases, and one field of enterprise 
after another is conquered by combination, the 
lines of the structure necessarily tend to steepen. 
It is a pyramid in which power radiates downwards, 
from a tiny knot of bankers at the top, through 
intermediate layers of industrialists and merchants 
to the mass of common men, who are twitched this 
way and that by the masters of the show, like 
puppets on wires. The brisk little goddess Individual 
Enterprise must occasionally look down from her 
seat on the summit with some qualms of perplexity 
as to the appropriateness of her temple. 


(ii) 


Liberty and Equality 

Liberty and equality have usually in England 
been considered antithetic; and, since fraternity 
has rarely been considered at all, the famous trilogy 
has been easily dismissed as a hybrid abortion. 
Equality implies the deliberate acceptance of social 
restraints upon individual expansion. It involves 
the prevention of sensational extremes of wealth 
and power by public action for the public good. 
If liberty means, therefore, that every individual 
shall be free, according to his opportunities, to 
indulge without limit his appetite for either, it is 


H 



20* CONDITIONS OF ECONOMIC FREEDOM 

clearly incompatible, not only with economic and 
social, but with civil and political, equality, which 
also prevent the strong exploiting to the full the 
advantages of their strength, and, indeed, with any 
habit of life save that of the Cyclops. But freedom 
for the pike is death for the minnows. It is possible 
that equality is to be contrasted, not with liberty, 
but only with a particular interpretation of it. 

The test of a principle is that it can be generalized, 
so that the advantages of applying it are not 
particular, but universal. Since it is impossible for 
every individual, as for every nation, simultaneously 
to be stronger than his neighbours, it is a truism 
that liberty, as distinct from the liberties of special 
persons and classes, can exist only in so far as 
it is limited by rules, which secure that freedom 
for some is not slavery for others. The spiritual 
energy of human beings, in all the wealth of their 
infinite diversities, is the end to which external 
arrangements, whether political or economic, are 
merely means. Hence institutions which guarantee 
to men the opportunity of becoming the best of 
which they are capable are the supreme political 
good, and liberty is rightly preferred to equality, 
when the two are in conflict. The question is whether, 
in the conditions of modern society, they conflict or 
not. It is whether the defined and limited freedom, 
which alone can be generally enjoyed, is most likely 
to be attained by a community which encourages 
violent inequalities, or by one which represses 
them. 

Inequality of power is not necessarily inimical 
to liberty. On the contrary, it is the condition of it. 
Liberty implies the ability to act, not merely to 
resist. Neither society as a whole, nor any group 



LIBERTY AND EQUALITY 209 

within it, can carry out its will except through 
organs; and, in order that such organs may function 
with effect, they must be sufficiently differentiated 
to perform their varying tasks, of which direction 
is one and execution another. But, while inequality 
of power is the condition of liberty, since it is the 
condition of any effective action, it is also a menace 
to it, for power which is sufficient to use is sufficient 
to abuse. Hence, in the political sphere, where the 
danger is familiar, all civilized communities have 
established safeguards, by which the advantages of 
differentiation of function, with the varying degrees 
of power which it involves, may be preserved, and 
the risk that power may be tyrannical, or perverted 
to private ends, averted or diminished. They have 
endeavoured, for example, as in England, to protect 
civil liberty by requiring that, with certain excep- 
tions, the officers of the State shall be subject to the 
ordinary tribunals, and political liberty by insisting 
that those who take decisions on matters affecting 
the public shall be responsible to an assembly chosen 
by it. The precautions may be criticized as in- 
adequate, but the need for precautions is not to-day 
disputed. It is recognized that political power must 
rest ultimately on consent, and that its exercise 
must be limited by rules of law. 

The dangers arising from inequalities of economic 
power have been less commonly recognized. They 
exist, however, whether recognized or not. For the 
excess or abuse of power, and its divorce from 
responsiblity, which results in oppression, are not 
confined to the relations which arise between men 
as members of a state. They are not a malady which 
is peculiar to political systems, as was typhus to 
slums, and from which other departments of life 



*io CONDITIONS OF ECONOMIC FREEDOM 

can be regarded as immune. They are a disease, not 
of political organization, but of organization. They 
occur, in the absence of preventive measures, in 
political associations, because they occur in all forms 
of association in which large numbers of individuals 
are massed for collective action. The isolated worker 
may purchase security against exploitation at the cost 
of poverty, as the hermit may avoid the corruptions 
of civilization by forgoing its advantages. But, as 
soon as he is associated with his fellows in a common 
undertaking, his duties must be specified and his 
rights defined; and, in so far as they are not, the 
undertaking is impeded. The problem of securing 
a livelihood ceases to be merely economic, and 
becomes social and political. The struggle with 
nature continues, but on a different plane. Its 
efficiency is heightened by co-operation. Its character 
is complicated by the emergence of the question 
of the terms on which co-operation shall take place. 

In an industrial civilization, when its first phase 
is over, most economic activity is corporate activity. 
It is carried on, not by individuals, but by groups, 
which are endowed by the State with a legal 
status, and the larger of which, in size, complexity, 
specialization of functions and unity of control, 
resemble less the private enterprise of the past 
than a public department. As far as certain great 
industries are concerned, employment must be 
found in the service of these corporations, or not 
at all. Hence the mass of mankind pass their 
working lives under the direction of a hierarchy, 
whose heads define, as they think most profitable, 
the lines on which the common enterprise is to 
proceed, and determine, subject to the intervention 
of the State and voluntary organizations, the 



LIBERTY AND EQUALITY 


211 


economic, and to a considerable, though diminishing, 
extent, the social environment of their employees. 
Possessing the reality of power, without the 
decorative trappings — unless, as in England is often 
the case, it thinks it worth while to buy them — 
this business oligarchy is the effective aristocracy 
of industrial nations, and the aristocracy of tradition 
and prestige, when such still exists, carries out its 
wishes and courts its favours. In such conditions, 
authority over human beings is exercised, not only 
through political, but through economic, organs. 
The problem of liberty, therefore, is necessarily 
concerned, not only with political, but also with 
economic, relations. 

It is true, of course, that the problems are 
different. But to suppose that the abuses of 
economic power are trivial, or that they are auto- 
matically prevented by political democracy, is to 
be deceived by words. Freedom is always, no 
doubt, a matter of degree; no man enjoys all the 
requirements of full personal development, and 
all men possess some of them. It is not only 
compatible with conditions in which all men are 
fellow-servants, but would find in such conditions 
its most perfect expression. What it excludes is a 
society where only some are servants, while others 
are masters. 

For, whatever else the idea involves, it implies, 
at least, that no man shall be amenable to an 
authority which is arbitrary in its proceedings, 
exorbitant in its demands, or incapable of being 
called to account when it abuses its office for 
personal advantage. In so far as his livelihood is 
at the mercy of an irresponsible superior, whether 
political or economic, who can compel his reluctant 



211 CONDITIONS OF ECONOMIC FREEDOM 

obedience by force majeure, whose actions he is 
unable to modify or resist, save at the cost of 
grave personal injury to himself and his dependents, 
and whose favour he must court, even when he 
despises it, he may possess a profusion of more 
tangible blessings, from beer to motor-bicycles, 
but he cannot be said to be in possession of freedom. 
In so far as an economic system grades mankind 
into groups, of which some can wield, if un- 
consciously, the force of economic duress for their 
own pront or convenience, whilst others must 
submit to it, its effect is that freedom itself is 
similarly graded. Society is divided, in its economic 
and social relations, into classes which are ends, 
and classes which are instruments. Like property, 
with which in the past it has been closely connected, 
liberty becomes the privilege of a class, not the 
possession of a nation. 

Political principles resemble military tactics; 
they are usually designed for a war which is over. 
Freedom is commonly interpreted in England in 
political terms, because it was in the political 
arena that the most resounding of its recent 
victories were won. It is regarded as belonging 
to human beings as citizens, rather than to citizens 
as human beings; so that it is possible for a nation, 
the majority of whose members have as little 
influence on the decisions that determine their 
economic destinies as on the motions of the planets, 
to applaud the idea with self-congratulatory gestures 
of decorous enthusiasm, as though history were 
of the past, but not of the present. If the attitude 
of the ages from which it inherits a belief in liberty 
had been equally ladylike, there would have been, 
it is probable, little liberty to applaud. 



LIBERTY AND EQUALITY 213 

For freedom is always relative to power, and 
the kind of freedom which at any moment it is 
most urgent to affirm depends on the nature of the 
power which is prevalent and established. Since 
political arrangements may be such as to check 
excesses of power, while economic arrangements 
permit or encourage them, a society, or a large part 
of it, may be both politically free and economically 
the opposite. It may be protected against arbitrary 
action by the agents of government, and be without 
the security against economic oppression which 
corresponds to civil liberty. It may possess the 
political institutions of an advanced democracy, 
and lack the will and ability to control the conduct 
of those powerful in its economic affairs, which is 
the economic analogy of political freedom. 

The extension of liberty from the political to 
the economic sphere is evidently among the most 
urgent tasks of industrial societies. It is evident 
also, however, that, in so far as this extension takes 
place, the traditional antithesis between liberty 
and equality will no longer be valid. As long as 
liberty is interpreted as consisting exclusively in 
security against oppression by the agents of the 
State, or as a share in its government, it is plausible, 
perhaps, to dissociate it from equality; for, though 
experience suggests that, even in this meagre and 
restricted sense, it is not easily maintained in the 
presence of extreme disparities of wealth and 
influence, it is possible for it to be enjoyed, in form 
at least, by pauper and millionaire. Such disparities, 
however, though they do not enable one group to 
become the political master of another, necessarily 
cause it to exercise a preponderant influence on 
the economic life of the rest of society. 



214 CONDITIONS OF ECONOMIC FREEDOM 

Hence, when liberty is construed, realistically, 
as implying, not merely a minimum of civil and 
political rights, but securities that the economically 
weak will not be at the mercy of the economically 
strong, and that the control of those aspects of 
economic life by which all are affected will be 
amenable, in the last resort, to the will of all, a 
large measure of equality, so far from being inimical 
to liberty, is essential to it. In conditions which 
impose co-operative, rather than merely individual, 
effort, liberty is, in fact, equality in action, in the 
sense, not that all men perform identical functions 
or wield the same degree of power, but that all 
men are equally protected against the abuse of 
power, and equally entitled to insist that power 
shall be used, not for personal ends, but for the 
general advantage. Civil and political liberty 
obviously imply, not that all men shall be members 
of parliament, cabinet ministers, or civil servants, 
but the absence of such civil and political inequalities 
as enable one class to impose its will on another by 
legal coercion. It should be not less obvious that 
economic liberty implies, not that all men shall 
initiate, plan, direct, manage, or administer, but 
the absence of such economic inequalities as can 
be used as a means of economic constraint. 

The danger to liberty which is caused by 
inequality varies with differences of economic 
organization and public policy. When the mass of 
the population are independent producers, or when, 
if they are dependent on great undertakings, the 
latter are subject to strict public control, it may 
be absent or remote. It is seen at its height when 
important departments of economic activity are 
the province of large organizations, which, if they 



LIBERTY AND EQUALITY 


215 

do not themselves, as sometimes occurs, control 
the State, are sufficiently powerful to resist control 
by it. Among the numerous interesting phenomena 
which impress the foreign observer of American 
economic life, not the least interesting is the 
occasional emergence of industrial enterprises which 
appear to him, and, indeed, to some Americans, 
to have developed the characteristics, not merely 
of an economic undertaking, but of a kind of 
polity. Their rule may be a mild and benevolent 
paternalism, lavishing rest-rooms, schools, gymnasia, 
and guarantees for constitutional behaviour on 
care-free employees; or it may be a harsh and 
suspicious tyranny. But, whether as amiable as 
Solon, or as ferocious as Lycurgus, their features 
are cast in a heroic mould. Their gestures are those 
of the sovereigns of little commonwealths rather 
than of mere mundane employers. 

American official documents have, on occasion, 
called attention to the tendency of the bare stem of 
business to burgeon, in a favourable environment, 
with almost tropical exuberance, so that it clothes 
itself with functions that elsewhere are regarded 
as belonging to political authorities. The corpora- 
tions controlled by six financial groups, stated the 
Report of the United States Commission on Indus- 
trial Relations some twenty years ago, employ 
2,651,684 wage-earners, or 440,000 per group. Some 
of these companies own, not merely the plant and 
equipment of industry, but the homes of the workers, 
the streets through which they pass to work, and the 
halls in which, if they are allowed to meet, their 
meetings must be held. They employ private spies 
and detectives, private police and, sometimes, it 
appears, private troops, and engage, when they deem 



2i8 conditions of ECONOMIC FREEDOM 

and of the squandering in dividends of resources 
which should be held as reserves, but of a sensational 
redistribution of wealth and widespread unem- 
ployment as a result of decisions taken by bankers 
— the diplomacy of business, like that of governments 
before 1914, is still commonly conducted over the 
heads of those most affected by it. The interests 
of the public, as workers and consumers, may receive 
consideration when these matters are determined; 
but the normal organization of economic life does 
not offer reliable guarantee that they will be 
considered. Nor can it plausibly be asserted that, 
if they are not, those aggrieved can be certain 
of any redress. 

Power over the public is public power. It 
does not cease to be public merely because private 
persons are permitted to buy and sell, own and 
bequeath it, as they deem most profitable. To 
retort that its masters are themselves little more 
than half-conscious instruments, whose decisions 
register and transmit the impact of forces that 
they can neither anticipate nor control, though not 
wholly unveracious, is, nevertheless, superficial. 
The question is not whether there are economic 
movements which elude human control, for ob- 
viously there are. It is whether the public possesses 
adequate guarantees that those which are con- 
trollable are controlled in the general interest, 
not in that of a minority. Like the gods of Homer, 
who were subject themselves to a fate behind the 
fates, but were not thereby precluded from 
interfering at their pleasure in the affairs of men, 
the potentates of the economic world exercise 
discretion, not, indeed, as to the situation which 
they will meet, but as to the manner in which 



LIBERTY AND EQUALITY 219 

they will meet it. They hold the initiative, have 
such freedom to manoeuvre as circumstances allow, 
can force an issue or postpone it, and, if open 
conflict seems inevitable or expedient, can choose, 
as best suits themselves, the ground where it shall 
take place. 

“ Even if socialism were practicable without the 
destruction of freedom”, writes Lord Lothian, 
“would there be any advantage in converting 
the whole population into wage or salary earners, 
directed by the relatively few, also salaried, officials, 
who by ability, or promotion, or ‘pulP, could work 
their way to the top of the political machine or 
the permanent bureaucracy? ... Is not that com- 
munity the best, and, in the widest sense of the 
word, the most healthy, which has the largest 
proportion of citizens who have the enterprise, 
and energy, and initiative, to create new things and 
new methods for themselves, and not merely to 
wait to carry out the orders of somebody ‘higher 
up’?”* In view of the practice, of some parts, at 
least, of the business world, the less said about 
“pull”, perhaps, the better. But how true in 
substance! And how different the liner looks from 
the saloon-deck and the stokehold! And how 
striking that the conditions which Lord Lothian 
deplores as a hypothetical danger should be 
precisely those which ordinary men experience 
daily as an ever-present fact! 

For, in England at any rate, as a glance at the 
Registrar-General’s reports would have sufficed to 
show him, not only the majority of the population, 
but the great majority, are to-day “wage or salary 
earners”, who, for quite a long time, have been 
“directed by the relatively few”, and who, if they 



220 CONDITIONS OF ECONOMIC FREEDOM 

did not “wait to carry out the orders of somebody 
higher up”, would be sent about their business with 
surprising promptitude. Unless Lord Lothian pro- 
poses to abolish, not only a particular political 
doctrine, but banks, railways, coal-mines and cotton- 
mills, the question is not whether orders shall be 
given, but who shall give them; whether there shall 
be guarantees that they are given in the general 
interest; and whether those to whom they are given 
shall have a reasonable security that, when their 
welfare is at stake, their views will receive an 
unbiased consideration. 

Freedom may be, as he insists, more important 
than comfort. But is a miner, who is not subject 
to a bureaucracy, or at least, to a bureaucracy of 
the kind which alarms Lord Lothian, conspicuously 
more free than a teacher, who is? If a man eats 
bread made of flour produced to the extent of forty 
per cent, by two milling combines and meat supplied 
by an international meat trust, and lives in a house 
built of materials of which twenty-five per cent, 
are controlled by a ring, and buys his tobacco 
from one amalgamation, and his matches from 
another, while his wife’s sewing-thread is provided 
by a third, which has added eight millionaires to 
the national roll of honour in the last twenty 
years, is he free as a consumer? Is he free as a 
worker, if he is liable to have his piece-rates cut 
at the discretion of his employer, and, on expressing 
his annoyance, to be dismissed as an agitator, and 
to be thrown on the scrap-heap without warning 
because his employer has decided to shut down a 
plant, or bankers to restrict credit, and to be told, 
when he points out that the industry on which 
his livelihood depends is being injured by mis- 



LIBERTY AND EQUALITY 


Z2I 


management, that his job is to work, and that the 
management in question will do his thinking for 
him? And if, in such circumstances, he is but 
partially free as a consumer and a worker, is not 
his freedom as a citizen itself also partial, rather 
than, as Lord Lothian would desire, unqualified 
and complete? 

Lord Lothian is misled as to liberty, because he 
has omitted to consider the bearing upon it of 
another phenomenon, the phenomenon of in- 
equality. The truth is that, when the economic 
scales are so unevenly weighted, to interpret liberty 
as a political principle, which belongs to one world, 
the world of politics and government, while equality 
belongs — if, indeed, it belongs anywhere — to another 
world, the world of economic affairs, is to do violence 
to realities. Governments, it is true, exercise powers 
of a great and special kind, and freedom requires 
that they should be held strictly to account. But the 
administration of things is not easily distinguished, 
under modern conditions of mass organization, from 
the control of persons, and both are in the hands, to 
some not inconsiderable degree, of the minority 
who move the levers of the economic mechanism. 
The truth of the matter is put by Professor Pollard 
in his admirable study. The Evolution of Parliament. 
“There is only one solution”, he writes, “of the 
problem of liberty, and it lies in equality. . . . 
Men vary in physical strength; but so far as their 
social relations go that inequality has been abolished. 
. . .Yet there must have been a period in social 
evolution when this refusal to permit the strong man 
to do what he liked with his own physical strength 
seemed, at least to the strong, an outrageous 
interference with personal liberty. . . . There is, in 



22i CONDITIONS OF ECONOMIC FREEDOM 

fact, no more reason why a man should be allowed 
to use his wealth or his brain than his physical 
strength as he likes. . . . The liberty of the weak 
depends upon the restraint of the strong, that of 
the poor upon the restraint of the rich, and that of 
the simpler-minded upon the restraint of the 
sharper. Every man should have this liberty and 
no more, to do unto others as he would that they 
should do unto him; upon that common foundation 
rest liberty, equality, and morality.”’ 


(iii) 


Industry as a Social Function 

A complex organization cannot function effectively 
without unity of direction. It is easy to prove that 
a hierarchy of authority, with gradations of responsi- 
bility, is as indispensable to modern industry as to 
a modern army. It is easy, but it is superfluous, 
for it is to labour a truism. 

It is obvious, indeed, that, so far from resisting 
the concentration of economic control, the whole 
tendency of democracy is to accelerate and 
systematize it. The trade union finds its gravest 
embarrassments in dealing, not with the great 
undertaking, in which the productive technique of 
capitalism is seen at its zenith, but with the old- 
fashioned establishment, whose obsolete machinery 
and ineffective organization depresses the standard 
of output and working conditions. The co-operative 
movement, with its vast trading and manufacturing 
businesses, is concerned, not to narrow, but 
progressively to extend, the area of large-scale 



INDUSTRY AS A SOCIAL FUNCTION 223 

enterprise, while securing that the economies which 
it yields are reaped by the consumer. The cotton 
operative who presses for the reconstruction of his 
industry, or the miner who urges the transference of 
minerals and mines to public ownership, does so 
partly, at least, as a step towards the substitution of 
a more rational organization for the welter of 
conflicting interests which prevent both consumer 
and wage-earner from reaping the fruit of scientific 
progress. The worker who is suspicious of rationaliza- 
tion does not object to the replacement of rule 
of thumb by system and order, but to the refusal 
to admit that, since he and his fellows are vitally 
affected by it, its application and methods, and the 
provision to be made for the workers whom it 
displaces, must be determined by agreement with 
the bodies representing them. What gives rise to 
resentment, in short, is not the existence of economic 
authority, but its irresponsibility. Freedom is 
conceived as consisting, not in its abolition, but in 
the establishment of guarantees that it will be used 
in the public interest, and that its relations with 
those affected by it will be based, not on superiority 
of force, but on consent. 

Thus interpreted — not as “the desolate liberty 
of the wild ass”, but as a community of service — 
economic freedom implies both diversity of function 
and equality of status. It is incompatible with the 
claim either that every man should exercise the 
same degree of influence on the conduct of the 
common enterprise, or that any man should exercise 
it merely for his personal gain. The principles on 
which its extension depends are three. The first 
is that an ever-widening area of economic relations 
shall be governed by settled rules, based on deliberate 



CONDITIONS OF ECONOMIC FREEDOM 

decisions as to social expediency, not by the 
pecuniary self-interest of property-owners and their 
agents. The second involves the recognition that a 
large range of economic interests, which have 
normally hitherto been regarded as the province 
of direction or management, must in future be the 
subject of common determination. The third has as 
its corollary the development of machinery to 
secure that the larger questions of economic strategy 
and industrial organization are treated as what 
in fact they are, a public concern, and that those 
who decide them must accordingly be accountable 
to the public for the tenor of their decisions. 
A rational policy will proceed simultaneously, 
therefore, along three principal lines. It will aim at 
establishing, by social action, conditions of life and 
work compatible with the standards of a civilized 
society, at extending the area of industrial relations 
subject to collective control and joint determination, 
and at ensuring that, on economic issues affecting 
the public welfare, the community can regularly 
and easily make its will prevail. 

Whatever interpretation may be given to the 
words “freedom” and “equality”, conditions which 
permit one party in industry, in matters of health, 
safety, hours, and wages, to impose its will upon 
another by force majeure are clearly incompatible 
with both. Great Britain led the way in protective 
legislation; but her factory and workshop code 
has not kept pace with her industrial developmentj 
and, from being a pioneer, she has become a laggard. 
The Act of 1937 introduced certain much needed 
improvements, particularly in matters of health 
and safety. In spite of it, however, the present 
position remains far from satisfactory. By an 



INDUSTRY AS A SOCIAL FUNCTION 225 

anomaly which has a historical explanation, but is 
logically indefensible, the hours of men are still not 
limited by law. While France has a 40 hour week, 
the normal day for women in this country has been 
fixed at 48, and for young persons — after an interval 
of five years — at 44. Overtime is permitted in the 
case of the former on a scale to deprive even that 
high maximum of much of its value. In a considerable 
number of occupations no legal maximum of any 
kind exists, and recent investigations have shown 
that a large proportion of the boys and girls engaged 
in them are working 50, 60, or even 70 hours a week. 
The statutory provision for an annual holiday with 
pay, which now exists in a large number of countries, 
is unknown in Great Britain. The attempt to extend 
common minimum standards by international action 
has been persistently thwarted by British govern- 
ments. In spite of the admitted success of the Trade 
Board system, a large body of workers is still 
without the protection of a legal minimum wage. 
A government, therefore, which took seriously the 
duty of establishing civilized standards of employ- 
ment for the whole population would find itself 
with plenty of work on its hands. It is obvious, 
however, that the sensitive nerve of industrial policy 
is to be found to-day in a different region. When 
these elementary, though urgent, needs have been 
met, the fundamental problems still await a 
settlement. 

If their solution is complex, their character is 
plain, for the history of the period since 1918 is a 
commentary upon it. The most striking feature of 
the industrial politics of the last quarter of a century 
has been the rise into prominence, side by side 
with the familiar questions of wages and working 



226 CONDITIONS OF ECONOMIC FREEDOM 

conditions, of issues relating to the organization, 
government and policy of industry. It is true, of 
course, that the more exuberant schemes were 
nipped in the bud by the depression, and that 
harassed trade union executives, caught between a 
contracting membership and an expanding un- 
employment percentage, have been in no mood to 
revive them. But the view that the attitude which 
found expression in projects for qualifying industrial 
autocracy by one version or another of ‘‘workers’ 
control” was a transient emotional disturbance, 
which would subside when the phrase, the war for 
democracy, with its misleading associations, was 
buried with its victims, has not been confirmed 
by subsequent experience. 

The truth is that such projects, whatever the 
precise form in which they were cast, did not create 
the sentiment, but were created by it. Being based, 
not on any doctrinaire enthusiasm for an abstract 
principle, but on the desire to mitigate grave 
practical evils, it has survived their collapse, and the 
changes at present being carried out under the 
name of rationalization, with the displacement of 
employees that, in some cases, they have involved, 
have inevitably strengthened it. They have under- 
lined the precariousness of the worker’s tenure, and 
have driven home the lesson that, unless from the 
start he has an equal voice with his employer in 
determining the procedure of reorganization and the 
safeguards to accompany it, his welfare will be 
given a second place when it comes to be introduced. 
Wage-earners, it appears, or, at least, an increasing 
proportion among them, may be secured a standard 
of remuneration and hours which, a generation ago, 
would have appeared utopian, and may continue. 



INDUSTRY AS A SOCIAL FUNCTION 227 

nevertheless, to feel an undiminished scepticism as 
to the equity of arrangements under which a 
committee of directors representing proprietary 
interests take decisions intimately affecting their 
welfare and happiness. What is, perhaps, more 
remarkable is the growing recognition, in quarters 
not specially susceptible to such ideas, that the 
intelligent consideration of questions of wages and 
working conditions, not to mention unemployment, 
necessarily involves the consideration of industrial 
organization and policy, and of possible modifications 
in them, since the answer to the former must partly 
depend on the view taken of the latter. Each of the 
four public inquiries into the coal industry which 
took place between 1919 and 1926 had as its 
immediate occasion the imminence of a wage 
dispute, but three out of the four were led to suggest 
changes, and two of them drastic changes, in its 
structure and methods. In cotton, wool, and 
engineering similar questions have emerged, and 
largely, if not wholly, for similar reasons. 

The growth of trade unionism has been partly 
extensive, partly intensive. It has taken place, on 
the one hand, by a numerical expansion of the 
movement and by the adherence to it of strata, 
such as unskilled workers, women, and clerical 
and supervising grades, which were formerly re- 
garded as above or below it. It has taken place, on the 
other hand, by the successful establishment of the 
claim that matters formerly reserved to the decision 
of the management shall be settled by negotiation. 
Its progress along the first line has been more 
impressive, however, than along the second. While 
all the greater industries, except agriculture and 
mining, are governed by national agreements, the 



228 CONDITIONS OF ECONOMIC FREEDOM 

range of interests accepted as subjects for joint 
determination is still, in most of them, surprisingly 
narrow, and the whole array of issues which relate 
to the organization and policy of industry, with 
their inevitable repercussion on the workers’ standard 
of life, is still normally excluded from it. The 
response of employers to the suggestion that 
professional associations of wage-earners, like those 
of doctors and teachers, may reasonably be consulted 
as to the conduct and development of their respective 
services, if politer in form than that of their grand- 
parents to the monstrous innovation of collective 
bargaining as to wages and hours, is, as a rule, still 
similar in substance. 

If trade unionism is to be as effective in practice as 
it is imposing on paper, its methods must keep pace 
with its objectives, and its objectives with the facts. 
A conception of its functions which regarded them 
as confined to bargaining with regard to wages 
and working conditions was natural in an age of 
economic expansion, when improvements could be 
secured by organized pressure, without raising 
fundamental questions of economic policy. But the 
limits within which these tactics can be successful 
have become, in many industries, if not rigid, less 
elastic than in the past. When employers reply to 
an application for an advance in wages, or a reduction 
in hours, that economic conditions do not admit of 
its being conceded, their statement, granted the 
continuance of the existing methods of the industry 
in question and the impossibility of improving them, 
is often indisputable. A union which, while accepting 
the |>remise, denies the conclusion, is attacking a 
position that might conceivably be turned, but which 
no frontal attack can succeed in forcing. It joins 



INDUSTRY AS A SOCIAL FUNCTION 229 

issue on ground least favourable to itself, where 
the battle is lost before it has begun. 

In such circumstances, the course of wisdom 
is to broaden the issue. It is to recognize that the 
traditional division of functions between “labour” 
and “management” no longer corresponds to 
economic realities, and that the debatable land 
between them, which has hitherto been claimed as 
the province of one party, must in future be 
recognized as the concern of both. Trade unions, 
if they are wise, will not merely kick the door, or 
batter the walls; but will consider whether the 
edifice itself is not capable of being reconstructed, 
and whether, if so, it will not pay them to take a 
hand in helping to reconstruct it. They will point 
out that the organization which happens to obtain 
in an industry, at some particular period of its 
history, is not fixed and immutable, and that an 
examination of its merits is essential to any serious 
consideration of their demands, since the ability 
of the industry to meet them is partly dependent 
upon the manner in which it is organized. Employers, 
provided that they can clear their minds of the 
metaphysical doctrine that the particular division 
between the spheres of labour and management to 
which they are accustomed is sacred and unalterable, 
will realize that they cannot at one moment talk 
eloquently of the partnership between labour and 
capital, and refuse labour the ordinary rights of a 
partner at the next. They will recognize that the 
wage-earner is as much entitled as the property- 
owner to claim equitable consideration for his 
established expectations, and that, when economic 
exigencies require them to be disturbed, due 
provision must be made by way of compensation 



230 CONDITIONS OF ECONOMIC FREEDOM 

for the individuals injured. They wiU appreciate that 
it is impossible to apply to their employees criteria 
of efficiency which they decline to permit to be 
applied to themselves, and that workmen have 
precisely the same right to be satisfied that 
organization is efficient, and management up to date, 
as management has that workmen are earning their 
wages. 

The practical application of such a policy would 
involve a change of relations both in the individual 
workshop and in each industry as a whole. It would 
mean, in the former, that the bad old tradition of 
autocratic government, already disappearing from 
all reputable firms, was finally discarded; that all 
matters affecting the position and prospects of the 
personnel, such as questions of discipline, the 
introduction of new processes, machinery, and 
so-called scientific management, were decided only 
after consultation with the representatives of the 
employees, whether shop stewards, workshop com- 
mittees, or trade union officials; and that no man was 
dismissed without the right of appeal to a committee 
on which he was represented. It would mean, in the 
latter, the end of the affectation that questions of 
business policy and organization do not concern, 
or are beyond the competence of, representatives of 
the workmen. In reality, of course, since, when no 
business is done, no wages are earned, such matters 
concern them as intimately as their employers; and, 
if relations are to correspond, not to a moribund 
social convention, which yearly becomes more 
ridiculous, but to economic actuahties, they must 
take account of that truism. It involves, at least, that 
both parties are equally informed as to the financial 
situation and projects of the industry and of every 



INDUSTRY AS A SOCIAL FUNCTION 231 

part of it; that questions of economic strategy, 
such as rationalization, with the provision to be 
made for displaced workers, the desirability of 
combination or amalgamation between firms, and 
the closing of uneconomic factories and pits, are 
discussed on terms of complete equality; that a 
trade union regards itself, in short, and is regarded 
by employers, as possessing functions which are 
neither primarily defensive nor primarily aggressive, 
but constructive, in the sense that it is concerned, 
not less than employers, with the improvement of 
technique and organization. 

Such an enlargement of the scope of collective 
bargaining is practicable only in industries where a 
high level of organization has already been attained. 
Hence it cannot be initiated by the State, but it 
can be encouraged and accelerated by it. The course 
to be avoided is that followed in connection with the 
much advertised, but highly ineffective. Joint 
Industrial Councils, which began as parliaments, 
and not infrequently continued, when they con- 
tinued at all, as tea-parties. The first step, no doubt, 
is to check autocracy in the workshop by legislation 
establishing workshop committees, with statutory 
powers in all matters affecting discipline, workshop 
rules, dismissals, and the introduction of new 
processes and machinery, as well, of course, as the 
safety and comfort of the factory. But it is equally 
essential to secure that the issues which are common 
to an industry as a whole, or to a substantial part of 
it, are decided in consultation with the workers’ 
representatives. The dictatorship of the property- 
owner, involved in the exclusive determination of 
matters affecting the welfare of several hundred 
thousand families by boards of directors representing. 



232 CONDITIONS OF ECONOMIC FREEDOM 

or supposed to represent, the interests of a few 
thousand investors, may have been unavoidable in 
the days when the lines of British company law 
were being drawn; but, with the separation of 
ownership from management, the growth of pro- 
fessional organization among wage-earners and the 
diffusion of education, the excuse for it has vanished, 
and, ceasing to be inevitable, it has become 
impertinent. “Science, skilled administration and 
technique, enterprise, and industrial energy”, justly 
observes Mr. Hobson, “are to-day more and more 
divorced from the owners of a business, the 
capitalists. . . . Capital is still an essential material, 
but it has no rightful claim or capacity either to 
direct these movements by its own will or to secure 
for its owners the lion’s share of the gains. The 
feeling, now rising into a conscious conviction, on 
the part of the workers in a mine or a mill, that the 
business into which they put all their working 
energy, and on which they depend for their living, 
‘belongs’ to them in a more real sense than to the 
shareholders, is making the old nineteenth-century 
capitalism, with its autocracy and profiteering, no 
longer workable”.* 

It is not a question, of course, of any mystical 
theory of industrial self-government, but of con- 
ferring on common men such power as is needed 
to protect them against economic oppression. 
Still less is it a question of the layman claiming 
to override the expert. As to nine- tenths of the 
problems confronting an industry, nine-tenths 
of existing directors are themselves laymen. If 
they are sensible, they act on expert advice, and 
such advice can be weighed by a trade union 
official with not less intelligence than by the titled 



INDUSTRY AS A SOCIAL FUNCTION 233 

pluralists who inspire — so it is alleged — confidence 
in shareholders, and amusement or consternation 
in everyone else. The important point is that it 
should be submitted to representatives of both 
parties, not of one alone. As things are to-day, the 
wage-earners, whose interests are most directly 
affected, are powerless to resist the social reactions 
of economic change, and more powerless to insist 
on it; it is a question, indeed, whether they have 
most to fear when an industry is reorganized or 
when it is not. On the one hand, a firm can introduce 
machinery which halves the personnel employed, 
dismiss adult workers to make room for youths, 
and close an undertaking on which the livelihood of 
a whole community depends, without any obligation 
to discuss its proceedings with the trade unions 
concerned, to notify any public authority of steps 
which may add thousands weekly to the cost of 
unemployment, or even to compensate the indi- 
viduals prejudiced. On the other hand, the self- 
interest, incompetence, or mere organized torpor 
of a few directors may delay the introduction of 
improvements which authoritative public investiga- 
tions have proved to be indispensable. 

Much is heard of the objections of the wage- 
earner to rationalization, and, in view of the manner 
in which it is sometimes carried out, they are not, 
perhaps, surprising. What is more significant, though 
less often remarked, is that manufacturers have not 
shown themselves to be impatient enthusiasts for it. 
When, some years ago, a committee of engineers 
appointed by Mr. Hoover investigated the causes of 
waste in American industry, the conclusion which 
they reached was that, in the industries examined, 
the responsibility of management ranged from 



234 CONDITIONS OF ECONOMIC FREEDOM 

50 to 8 1 per cent., of labour from 9 to 28 per cent., 
and of other factors, including the public, from 
9 to 40 per cent.® In England, it is not the miners 
or cotton operatives who rejected for nearly a 
decade every proposal for putting the coal and 
cotton industries on their feet, and, in view of the 
grave revelations recently made with regard to both, 
the pretence that the capitalist is the heaven-inspired 
guardian of economic efficiency is a bluff too un- 
plausible even to be entertaining. When an industry 
misconducts itself, employers may be embarrassed, 
but workmen are ruined. They have at least an 
equal claim to occupy a position which will enable 
them to insist that waste shall be eliminated, 
antiquated methods overhauled, and reorganization, 
when reorganization is desirable, carried out. In 
this matter, their interests are identical with those 
of the consumer. Both the workers in an industry 
and the general public suffer when its organization 
is antiquated and inefficient. Both are equally 
concerned that necessary measures of modernization 
should not be impeded by the inertia of vested 
interests, and that machinery should exist to ensure 
that those measures are promptly applied. 


The policy required is two-fold. It is concerned 
partly with industries remaining in private hands, 
partly with the extension of the area of public 
ownership. The machinery required for the first 
could take several different forms. One obvious 
method of dealing with them would be to establish 
a standing industrial commission, or — ^if that name 
be preferred — a Planning Department, with power 
to insist that different industries shall put their 



INDUSTRY AS A SOCIAL FUNCTION 235 

houses in order, and that, when they do, the 
interests of the workers and the public shall receive 
adequate consideration. Such an authority would 
make a survey of the condition of different industries^ 
with a view to determining the changes required 
in their organization and structure. It would 
consider all proposals submitted, whether by 
employers, trade unions or bodies representing the 
public, for bringing them up to date, eliminating 
inefficiency and waste, and protecting the consumer. 
When the former took the initiative — ^when, for 
example, a firm or group of firms contemplated 
rationalization, a merger, or other departure affecting 
the public interest, the authority would have power 
to require that, before the scheme was carried 
out, full details of the steps proposed should be 
submitted to it. It would satisfy itself that the 
unions and other interests concerned had been 
consulted; and, after hearing evidence from the 
parties affected, would lay down such safeguards, 
whether by way of shorter hours, arrangements for 
transference of workers, pensions and compensation, 
control of prices, or representation of the public on 
the governing body of a combine, as it deemed 
expedient. When no proposals were submitted 
either by employers or trade unions, it would, if it 
thought reconstruction urgent, itself take the 
initiative in preparing a plan. In either case, on 
deciding that a good case for reorganization existed, 
it would have power, if persuasion failed, to insist 
on its being carried out, and for that purpose to 
make a compulsory order. The sanction in the 
background, if obstruction were encountered, would 
be the transference to public ownership of the 
industry concerned. 



236 CONDITIONS OF ECONOMIC FREEDOM 


The existence of such an authority would have 
several advantages. It would ensure that industries 
remaining in private hands were conducted with 
a due regard to the public interest. It would 
maintain a steady pressure on the side of the 
removal of inefficiency and the improvement of 
methods. It would be a stimulus to industrialists, 
who would know that, in the event of their policy 
creating general dissatisfaction, they would be com- 
pelled to justify it to a public body. It would 
be a guarantee that the wage-earners and con- 
sumers would not be sacrificed either to mere 


inertia or to schemes of reorganization carried out 
over their heads. Though necessary, however, as a 
first step, such a measure touches only a part of the 
problem. As a compromise solution, to be applied 
to industries of a type or scale not demanding a 
more trenchant policy, control has its utility. But 
such industries, though the most numerous, are 
not the most powerful or the most important. 
There are certain great services which cannot safely 
be resigned to exploitation for private profit, because 
the public welfare is so intimately dependent upon 
them, that those who own them become, in 
effect, the masters of the nation. There are certain 
others in which the consumer is at the mercy of the 


monopolist. In all the first, and some of the second, 
regulation is insufficient. What is required is public 
ownership. 

The discussion of that issue is muffled, not only 


by the din of the interests which it threatens, but 
by the opaque fog of an obsolete terminology. 
Private enterprise and nationalization, which are 


the counters in the controversy, are a convenient 


short-hand, but the day when it could be illuminated 



INDUSTRY AS A SOCIAL FUNCTION 237 

by these dialectical antitheses is now long over. 
On the one hand, not only is a great part of private 
enterprise no longer, in any rational sense of the 
word, private, since it impinges at every turn on 
public interests, but, so far from being the simple 
self-explanatory formula that lends fire to perora- 
tions, it is, in reality, a highly complex conception, 
which covers undertakings varying in economic 
character from an apple-stall to Imperial Chemical 
Industries, Ltd., and in legal status from a tobacco- 
shop to the Great Western Railway. On the other 
hand, if the demand for nationalization implies 
that economic policy should be determined by 
considerations of public expediency, not of pecuniary 
profit, and should be controlled by an authority 
accountable to the nation, not to shareholders, it 
is clearly compatible with the widest diversities of 
constitution and government. What matters is 
the facts, not the names by which they are called. 
The important question is not whether an under- 
taking is described as private or public; it is whether, 
if it is private, adequate guarantees can be established 
that it performs a public function, and whether, if it 
is public, it performs it effectively. Since the rights 
composing property can be attenuated piece-meal, 
as well as transferred in block, the achievement of 
the ends for which public ownership is desired need 
not always involve a change of owners. Since methods 
of organization are as various in public as in private 
undertakings, the question of the administrative 
technique most conducive to efficiency still remains 
to be settled, when the change has taken place. 

Expropriation by purchase, to which the word 
“nationalization” is most commonly applied, is a 
convenient method of securing that an undertaking 



CONDITIONS OF ECONOMIC FREEDOM 

is conducted as a public service. It puts the business 
through at a single stroke, avoids the conflict of 
interests and duplication of effort which is liable 
to be produced by a policy of regulation, makes 
possible reorganization on a comprehensive plan, 
and, though its immediate financial advantages — 
since interest must be paid — are sometimes small, 
secures to the public the economies of unification 
and the increment arising from future expansion. 
But, though a convenient method, it is not the only 
method. It is one species of a genus, not a genus 
by itself. 

In England, quite apart from the short-lived crop 
of wartime experiments and the inroads on the 
domain of profit-making enterprise made by the 
impressive advance of the co-operative movement, 
a variety of expedients have already been adopted — 
from the control of local monopolies by fixing 
charges and regulating profits on a sliding scale, 
to legislation prescribing, like the Railways Act 
of 1921 and the tentative Electricity (Supply) 
Act of 1926, the organization of an industry and 
its relations to the public — for tempering the 
operation of economic interests by mild inoculations 
of social responsibility. In view of the existence of 
some two thousand statutory companies with a 
capital of approximately j^i, 370,000,000 — ^more than 
a quarter of that invested in registered companies — 
in which both profits and the discretion of directors 
are limited by public intervention, the doctrine that 
industry cannot be carried on unless the claim of 
the ordinary shareholder to the whole of the 
residuary net profits is maintained inviolate has long 
been obsolete. On the Continent, and in the British 
Dominions, the devices by which public authorities 



INDUSTRY AS A SOCIAL FUNCTION 239 

have at once controlled and aided economic develop- 
ment — ^including, as they do, the acquisition of shares 
in companies, the nomination of their presidents 
and directors, the grant of concessions for a limited 
period of years, the use of public credit, and 
pecuniary subventions, direct and indirect — are still 
more various. 

Nor, when ownership, rather than regulation, 
has been the method favoured, has administration 
conformed to any uniform pattern. So far, indeed, 
is management by a department of the Civil Service 
under a political chief, on the lines of the British 
Post Office, from being the universal plan, that it is 
actually the exception. The general tendency of 
the period since 1918 has been both for public 
ownership to be extended and for Etatisation or 
V erstaatlichung to be replaced by some form of 
autonomous management. In view of the varieties 
of administrative organization represented in the 
public railways, canals and waterways, lands and 
forests, electricity works, banks, and insurance 
undertakings, existing in different continental 
countries, the miscellaneous businesses of some 
of the British Dominions, and the multitude of 
municipal undertakings everywhere, the idea, 
embalmed with other antiquities in the mausoleum 
of the press, that public ownership necessarily 
involves bureaucracy, except in the sense that all 
large-scale organization is bureaucratic, is not even 
plausible. It is a British superstition which descends 
from the sixties of last century, when the telegraphs 
were transferred to the Post Office. It is on a par 
with the engaging conviction of that age that 
Frenchmen were frivolous, foreigners unwashed, 
and presidents of republics in hourly danger of 

I 



240 CONDITIONS OF ECONOMIC FREEDOM 

assassination. Like the processes of industry, it 
requires to be rationalized. 

Reason needs light, and the first condition of 
applying it to economic affairs is simple. It is 
complete publicity with regard to the facts of 
industry. A system which enables undertakings, that 
owe their very existence to Acts of Parliament, 
sedulously to conceal essential evidence as to their 
situation and prospects, so that “the honest financier 
spends his time in getting hold of true information to 
which he is not entitled, and the less honest in 
spreading false information for which, under the 
cover of general darkness, he can obtain credence”,^® 
while the public is kept in the dark by both, might 
have been expressly invented to put a premium on 
chicanery and to stabilize incompetence. If the 
consumer is to be protected against extortion, and 
the wage-earner is to possess a guarantee that he is 
not being defrauded, it is obviously essential that 
the full facts as to the position of an industry and 
of every part of it should be regularly divulged. 
Quite apart from any change in the presentation 
of company accounts which may be required in 
order to protect shareholders, it should be the duty 
of a government department to publish annually a 
report on the condition of all major industries. In 
such a report the essential facts as to the capital 
invested, profits on capital and turnover, the costs 
of production in different firms and the items 
composing them, distributing charges and the 
spread between the factory or pit-head price and 
that paid by the consumer, and particulars as to 
rings, combines, and amalgamations, should be 
fully set out, with the comments and explanations 
needed to make them intelligible to the layman. 



INDUSTRY AS A SOCIAL FUNCTION 141 

If publicity is the first requirement, it is only the 
first. It is necessary, not only because honest men 
do not keep cards up their sleeves, and, when 
nothing can be hidden, there will be less to hide, 
but as the prelude to a more rapid extension of 
public ownership and control than is possible to-day, 
which is one reason, indeed, why it arouses appre- 
hension. The technique of extending them will 
vary, of course, with the varying circumstances of 
different services. The co-operative movement, 
with its fixed interest on capital and its return of 
profits to the consumer, combines the economics 
of large-scale organization with popular control, and 
offers a check on extortionate prices, the effect of 
which is felt far beyond the ranks of its six million 
members. The enterprises of Local Authorities, 
which represent to-day an investment of some 
,^700,000,000, are an equally significant application 
of the principle that essential undertakings should 
be conducted as public services. The absurd 
restriction, it may be observed in passing, which 
condemns cities such as Manchester and Glasgow 
to the costly procedure of private bill legislation 
before they are permitted to supply some new need, 
is a tax on efficiency which benefits no one but 
lawyers. Local experiments, which are the necessary 
foundation of any general policy, ought obviously 
to be encouraged. Subject to due safeguards in 
the matter of capital expenditure, county boroughs 
and counties, at any rate, should be empowered to 
engage in such new forms of enterprise as, from time 
to time, they may deem expedient. 

The services which present the crucial problem 
clearly stand, however, in a different category, and 
must be dealt with by a national policy or not at all. 



242 CONDITIONS OF ECONOMIC FREEDOM 

The condition of dealing with them intelligently 
is to determine their character. It is to classify 
industries by the degree to which they are invested, 
for one reason or another, with a public significance, 
and to treat them in accordance, not with any 
abstract formula, but with the realities of their 
position. If those which, owing to the character of 
their product, the demand for which they cater, or 
their dependence on personal taste, initiative, and 
skill, are private enterprises in the proper sense of 
the term, be left on one side, the remainder may be 
grouped in three broad classes: (i) those which are 
the foundation of the national economy, in the 
sense that its health and prosperity are dependent on 
them; (ii) those dominated, in whole or in part, by 
some form of combination; (iii) those which require 
to be reorganized, in order to be efficient, but are 
paralysed by lack of capital or the obstruction of 
interests. While the industries included in these 
categories are both diverse and overlapping, they 
have the common characteristic of being invested, 
through the logic of economic facts, with a public 
importance. Unless it be held that it is a matter of 
indifference that essential services should be con- 
ducted with an eye, not to the general welfare, but 
to the profits of investors, that productive efficiency 
should stagnate or run down, and that consumers 
should be exploited, the case for submitting them to 
public control is not open to question. Whether 
control should take the form of regulation, or of their 
acquisition by the State and management by a 
public body, is a question of expediency, to be 
answered differently in different cases. In the case 
of the third, as was suggested above, regulation 
may suffice. In the case of the first, and of some of 



INDUSTRY AS A SOCIAL FUNCTION 243 

the second, the right policy is public ownership. 

An intelligent policy will start from the centre, 
not nibble at the outworks. The first requirement is, 
clearly, to master the key positions of the economic 
world, whence the tune is piped to which the nation 
dances. Banking, evidently, is one, for it determines 
the economic weather more directly than any other; 
transport a second, and power a third; while the 
coal industry, in England the sole source of power, is 
a fourth, land and agriculture a fifth, and armaments 
a sixth. Transport and power have already been 
treated by the State as a special problem. The 
transference of minerals to public ownership has 
been recommended by two commissions, of which 
one, in addition, urged the public ownership of 
mines, and the other their control by a board of state 
commissioners. Professor Orwin and Mr. Peel, who 
write as agriculturists, not as politicians, have 
recently suggested that, in view of the changes of 
the last fifteen years, the acquisition of agricultural 
land by the State is “the only way of escape from 
the position into which the country is drifting”.^ 
Few persons, whatever their enthusiasm for private 
enterprise, desire to abolish the Crown’s monopoly of 
coining money, and the objections to the control of 
credit by private institutions, qualified though it is 
by the relations between the Treasury and the Bank 
of England, are similar in kind to those applying to 
private mints. The power wielded is too extensive, 
and the interests affected too various and too critical, 
for it to be appropriately entrusted to joint-stock 
companies. 

The truism that these services possess a special 
character, which should remove them from the 
sphere of profit-making enterprise, does not imply 



244 CONDITIONS OF ECONOMIC FREEDOM 

that they should be treated on any uniform plan. 
Ownership and control may both achieve the 
desired result, and the choice between them is a 
matter of expediency, to be decided with reference 
to the individual case. What is to be expected is the 
application, not of any rigid or unvarying technique, 
but of a diversity of expedients. These expedients 
will include, in addition to the administration of 
certain services by state commissioners, the extension 
of public utility companies working under statutory 
constitutions, the acquisition by public authorities of 
a controlling interest in private undertakings and the 
appointment of directors, the assistance with capital 
and credit of approved concerns which comply with 
conditions as to operation prescribed by the State, 
the control of raw materials and primary products 
by import boards, and the introduction of the public 
costing system which worked such wonders during 
the war, and for which Mr. and Mrs. Webb have 
so often pleaded. 

Public or semi-public bodies already own land, 
to the extent of, approximately, a million and a 
half acres, and, if the ownership of the remainder, 
together with that of minerals, were acquired by 
the State, the task of administering them would 
present few difficulties that have not already been 
successfully overcome. No intricate problem, again, 
is involved in modernizing the antiquated constitu- 
tion of the Bank of England, so as to make the 
Bank avowedly the public institution which already, 
in large measure, it is in fact; while, if the State 
acquired 51 per cent, of the share-capital of the 
joint-stock banks, and with it the determining voice 
in their policy, it is improbable that the officials by 
whom they are administered would either resign 



INDUSTRY AS A SOCIAL FUNCTION Z45 

their posts or fill them less efficiently. Nor, in view 
of the part which electrical power will play in the 
future, can its production be safely resigned to the 
private monopolist. The transference of this side of 
the industry to the Electricity Commissioners, who 
already are responsible for distribution, should be 
accompanied by the acquisition by the State of the 
coal industry, to be administered under the direction 
of the commissioners charged with the management 
of the State’s mineral property. Railways, which 
operate under a statutory constitution, and which, if 
they are to be regarded as an example of private 
enterprise, are not what anyone meant by private 
enterprise fifteen years ago, need not be bought out. 
The practical advantages of public ownership 
would be secured if their directorates were 
appointed by the State. 

“A king”, wrote a famous English lawyer, in 
the days when kings could still cause trouble, “is 
a thing men have made for their own sakes, for 
quietness’ sake, just as in a family one man is 
appointed to buy meat”. If power divorced from 
responsibility is the poison of states, it is improbable 
that it is the tonic of economic effort. It is possible 
that the struggle with nature, which gives that 
effort its meaning, would be waged more effectively 
were Selden’s maxim applied to the relations of 
producers as well as of citizens. For efficiency rests 
ultimately on psychological foundations. It depends, 
not merely on mechanical adjustments, but on the 
intelligent collaboration of contentious human 
beings, whom hunger may make work, but mutual 
confidence alone can enable to co-operate. If such 
confidence is to be commanded by those vested with 
the direction of economic affairs, their authority 



246 CONDITIONS OF ECONOMIC FREEDOM 

must rest, not on the ownership of property, but on 
a social title, and be employed for ends that are not 
personal, but public. It must become, in effect, 
whatever its precise style and form, a public servant, 
whom its masters can call to account for the 
discharge of its office. 



DEMOCRACY AND SOCIALISM 


Civilization has two aspects. It requires, on the 
one hand, the conquest by man of his material 
environment. It demands, on the other, a habit of 
discrimination between the relative values of 
different activities, without which his victories 
are more disastrous than defeats. Half a century 
ago, it could still be assumed that the army was 
advancing on both fronts at once, and that, in 
proportion as mankind solved the problem of 
controlling nature, their political systems and 
social institutions would rise to new heights. That 
creed had its virtues, but facts have been too 
strong for it. If a connection exists between the 
dazzling achievements of science and technology 
and the qualities required to reap their fruits in 
peace and distribute them with justice, the link, 
it is evident, is both different in kind and more 
slender in degree than was formerly supposed. 
It is possible, we now know, for a society to be 
heir to the knowledge of all the ages, and to use 
it with the recklessness of a madman and the 
ferocity of a savage. It may succeed in discovering 
the secret of abundance, only to bar the doors 
which it has laboured to unlock. It may master the 
means to harness nature to its chariot, and then 
employ them to drive with greater speed to the 
precipice. Mr. Wells’s vision of a world controlled 
by Samurai and airmen is the only utopia which 
has approached realization. It is still uncertain 
whether mankind can survive it. 



248 


DEMOCRACY AND SOCIALISM 


(i) 

Forms and Realities 

Our age is not the first to have reaped the ruin 
resulting from an enlargement of men’s powers, 
unaccompanied by a growth in the capacity to 
control them. If the divorce between knowledge 
and political intelligence is a ground for surprise, 
it belongs to the permanent paradoxes which are 
indistinguishable from truisms. One reason for it, 
at least, is not difficult to state. The beginning of 
wisdom is to look facts in the face, and to call them 
by their right names. When natural phenomena are 
in question, such sincerity may be difficult, but it 
no longer encounters determined resistance. The 
sciences concerned with them deal with means, not 
with ends, and, while contributing to the improve- 
ment of the mechanism of social life, offer no direct 
or obvious challenge to its basis and objectives. 
In spite of their immense explosive power, they 
are ethically neutrals, whom established authority 
can employ for its own purposes, from the produc- 
tion of rust-resisting wheats to the manufacture of 
poison-gas, without fearing that thereby it is 
jeopardizing its position. Hence, on matters of this 
kind, laymen desire to know the truth, and welcome 
discoveries which cause more of it to be known. In 
political and social affairs, the prevalent attitude is 
different. These things touch alike the sentiments 
and the interests of powerful classes. Complete 
candour on such subjects, therefore, is rarely 
desired, and more rarely practised. In some countries, 
the open discussion of them is forbidden under legal 



FORMS AND REALITIES 


249 


penalties, for fear that the foundations of the 
social pyramid will be eroded or undermined. In 
others, they become the subject of decorous equivo- 
cation. A half-conscious hypocrisy with regard 
to them is a powerful vested interest. 

That attitude does not, indeed, prevent the 
facts from being known, for the practical necessities 
of a complex society require them to be available. 
Its action is more subtle, but not less effective. It 
interposes a veil between men’s minds and the 
realities, which, though not too opaque to allow 
the latter to be seen, changes their colour and 
proportions, and, while revealing their existence, 
conceals their significance. Thus shielded against 
too violent an impact of disturbing truths, the 
rulers of mankind are enabled to maintain side by 
side two standards of social ethics, without the 
risk of their colliding. Keeping one set of values 
for use, and another for display, they combine, 
without conscious insincerity, the moral satisfaction 
of idealistic principles with the material advantages 
of realistic practice. 

The first are matters of traditional lore and 
conventional proprieties. The second is embodied 
in the social systems they maintain, the forms of 
economic organization to which they lend their 
sanction, the relations between nations and classes 
resulting from both, and the practical conduct 
which those relations produce. An anthropologist 
who investigates the life of a primitive people 
gives due weight to the utterances of the elders 
of the tribe, but he devotes his main attention to 
such impersonal facts as its family system, its class 
structure, its customs as to property, its methods 
of organizing the activities needed to provide its 



Z 50 DEMOCRACY AND SOCIALISM 

livelihood. In studying civilized societies, the 
right procedure is the same. Their character is to 
be ascertained by a consideration, not of what 
they profess, however candid in intention their 
professions may be, but of their behaviour. Where 
their treasure is, there will their heart be also, 
and their preferences are revealed by the choices 
which they make. Their opinions may be learned 
from their speeches. To know their convictions, 
one must examine their institutions. 

The existence of this double standard in the 
relations between nations is a well-worn common- 
place. Its significance is less readily acknowledged, 
but is equally undeniable, in the relations between 
classes. The ostensible principles of western civili- 
zation are personal liberty, equality before the 
law, the career open to talent, the protection of 
the weak against the rigours of exploitation, 
political democracy. Its economic institutions take 
their stamp from the struggle for wealth and 
power which is the dominant motif of the existing 
economic order. Hence, in capitalist societies, these 
principles are confronted by an array of hostUe 
powers, which, without disputing their validity, 
prevent their application. Liberty is thwarted 
by the pressure of an economic system which vests 
in a minority of property-owners the control of 
the plant and equipment without access to which 
the majority cannot live, and thus enables the 
former to impose its will on the latter, without 
physical compulsion, by economic duress. Justice 
is in England an expensive luxury which, except 
in minor cases, a man with small means can with 
difficulty afford. The belief that equality of oppor- 
tunity is more than an aspiration can hardly 



FORMS AND REALITIES 


251 


survive a familiarity with the facts of the educational 
system, or with the conditions of recruitment of 
the better paid professions. Humanitarian sentiment, 
however sincere, does not in practice prevent the 
sacrifice of the young to the alleged necessities of 
industry, or the imposition on the unemployed 
worker, as a condition of assistance, of requirements 
incompatible with decency and self-respect. The 
language in which the political system of Great 
Britain is commonly described on the platform 
and in the press is not easily reconciled with the 
possession by property of a second chamber to 
itself, or with the influence exercised by wealth 
in the choice of the first. Such societies are open 
to a new version of the criticism suggested in the 
familiar statement that it is not possible for a 
nation to live half slave and half free. The nominal 
rights of all citizens are the same; but the difference 
in their practical powers is so profound and far- 
reaching as to cause the majority of them to possess 
something less than full citizenship. 

In times of tranquillity this half-conscious 
contradiction may for long pass unchallenged. 
It is tolerated as an amiable eccentricity, or even, 
by a climax of fatuity, applauded as an asset. In 
periods of crisis, fate calls the bluff. A society 
shattered by war, or crumbling into ruin beneath 
intolerable economic strains, is compelled to find a 
basis on which to rebuild. It is then forced to 
make explicit to itself, if not to the world, the 
principles on which it intends that the new order 
shall be reared. At such moments the conflict 
between the ethical ideals, to which its lip-service 
has been paid, and the practical assumptions, on 
which its institutions have rested, passes into a 



252 DEMOCRACY AND SOCIALISM 

fresh stage. It ceases to be a mere mental incon- 
sistency, and becomes, whatever the precise methods 
employed, an active, and, sometimes, a desperate, 
struggle. It is this phase whose unfolding we have 
witnessed during the last twenty years. It lends to 
the revolutions and counter-revolutions of eastern 
and central Europe a universal significance, tran- 
scending the personal heroisms and crimes of 
the actors in the drama. 

In most of the regions in question, industrial 
capitalism is a thing of yesterday; in none of them 
has it existed, on any considerable scale, for much 
more than half-a-century. To interpret their recent 
history purely in western economic terms is 
necessarily, therefore, to make nonsense of much 
of it. Two of the greatest achievements of the 
Russian revolution — the reconciliation of the 
racial minorities and the agricultural reconstruction 
— ^were a response to problems which cried aloud 
for solution for centuries before the first modern 
factory was established. The reversion of Germany 
to a half-tribal conception of national unity, 
which regards it as consisting, not in a community 
of culture, but in the mere physical relationships 
of a human herd; the idealization of the chief, 
who represents the blood-bond, and the persecu- 
tion of the alien, who is unprotected by blood- 
brotherhood; the cult of force, and the belief that 
violence in achieving successes is hardly less 
important than the successes themselves — ^such 
phenomena are as little a product of the capitalist 
era as are the appeal to the 'petite bourgeoisie, the 
laws which attempt to tie the peasant to the soil, 
or the revival of the worship of Odin and Thor. 
They are more ancient and more terrible — a form 



FORMS AND REALITIES 253 

of political primitivism born in the mists of pre- 
history, and surviving through distracted centuries, 
in which unity and power were achieved by other 
nations, but in Germany remained a phantom, 
still pursued and never embraced. It remains true, 
nevertheless, that, in all societies where capitalism 
has taken root, the divisions which it creates are 
so profound and far-reaching that all other move- 
ments tend to be merged in that central issue, as 
a thousand cupidities and fears once poured their 
venoms into the so-called Wars of Religion. Such 
movements must either come to terms with the 
existing economic order or attack it; they cannot 
remain neutral. Hence, however diverse the elements 
they contain, they become part of the general 
and world-wide struggle to maintain capitalism 
or to end it. 

In those countries where democracy was non- 
existent, as in Russia, or where, as in Italy and post- 
war Germany, it was an exotic plant, the collision 
was violent, and the denouement trenchant. The 
difference between them was profound; the god 
of the one was the devil of the others. But all alike 
repudiated with contemptuous indignation the 
encyclopaedia of political cant palmed off, as they 
suggested, on a credulous Europe since 1789. 
All were involved either in civil war, or in action 
of a ruthlessness hardly distinguishable from that 
of war. All established, and all, with the possible 
exception of Russia, maintain, some form of dictator- 
ship, the first to destroy capitalism, the two last to 
preserve it. In countries where liberalism, in the 
historical sense of the word, has permeated the 
national psychology, and has not yet encountered 
forces strong enough to destroy it, the substance of 



254 DEMOCRACY AND SOCIALISM 

the Struggle has been the same, but its methods have 
been different. There also the conflict has been 
sharpened; but it has retained its old guise of a 
contest between parties for the capture of the 
existing state, not of a war between enemies, with 
a new state as the prize. It has proceeded by 
attrition, not by mass attacks. Its note has been, 
not drastic solutions, but a tortuous indecision. 
It has taken place, not, as in Italy and Germany, 
first in order to destroy the forms of democratic 
government, and then to prevent their resurrection, 
but within the limits which they impose. Inevitably, 
however, those forms themselves have felt the strain. 
Hence the question whether democracy will continue 
to survive is posed to-day in countries where till 
recently the question would have been dismissed 
as the height of absurdity. 


(ii) 


The Menace to Democracy 

That democracy and extreme economic inequality 
form, when combined, an unstable compound, is 
no novel doctrine. It was a commonplace of political 
science four centuries before our era. Nevertheless, 
though a venerable truism, it remains an important 
one, which is periodically forgotten, and periodi- 
cally, therefore, requires to be rediscovered. In the 
infancy of democracy, its significance escapes notice. 
In all countries in Europe a time-lag has inter- 
vened between the extension of political rights to 
fresh sections of the population, and the discovery 
by the latter of the most effective methods of 



THE MENACE TO DEMOCRACY 255 

using them. Only a fool fakes the pack, if he can 
deal himself the best cards; and, during that 
interval, when democracy is passive, there is no 
motive for meddling with it. A different situation 
arises when democracy comes to life, and when its 
pressure on established interests becomes continuous 
and severe. It is then liable to enter on a period of 
unstable equilibrium, which may, according to 
circumstances, be both dangerous and prolonged. 
Its growing strength is an incentive to operate 
upon it, before it becomes stronger; its surviving 
weaknesses are sufficient to create the impression 
that the risks of an operation are not too great to 
be run. If safe when too powerful to be attacked, 
or too powerless to be worth attacking, it passes, 
as it grows, through an adolescent phase, when it 
presents an appearance at once menacing and 
feeble. It is during that transition period that it 
runs the gauntlet. 

A crisis in the history of democracy, as it grew 
towards maturity, was, therefore, to be expected, 
even apart from the effects of the forcing-house 
of war and economic disaster. So far from being a 
matter for surprise, it is of the nature of the case. 
It is true that the progress of democracy before 
1914 is commonly exaggerated, with the result 
that its defeats in the last fifteen years are exaggerated 
also. It is true that, if responsible government, 
with a reasonably wide franchise, be regarded as 
its essential feature, then in no country where 
democracy has been overthrown had it existed for 
half a century, and in no country where it had 
existed for half a century has it as yet been over- 
thrown. The consolation, however, is meagre, nor 
does it touch the crucial point. Democracy held 



256 DEMOCRACY AND SOCIALISM 

the initiative; it has been thrown on the defensive. 
It was thought to be master of the future; for 
fifteen years it has lost ground. It is impossible to 
be certain that the retreat will not continue. 

The forms which the threat to democracy 
assume are of more than one kind. It is a mistake 
to suppose that it has nothing to fear, till attacked 
by the methods of open violence by which it was 
overthrown in the Fascist states. Where it is still 
the established political system, the menace to it 
wears, in the first instance, a guise which prevents 
it from being generally recognized as a menace at 
all. In spite of the profound differences between 
them, the domestic history of several of the 
democratic states has shown, during the last 
decade, strong traces of a common pattern. In 
Great Britain, France and the United States — ^to 
mention no others — its most significant features 
have been two. The first has been the attempt 
of Left or Left-Centre governments to control 
capitalism, without effecting any fundamental 
change in the balance of economic power. The 
second has been the use of economic power by the 
dominant forces of the existing social order to 
thwart or paralyze governments thought dangerous 
to property. 

It is now generally admitted that the British 
financial crisis of 1931 was due primarily to causes 
with which public expenditure in Great Britain 
had little to do; the City, having borrowed 
short and lent long, could not meet the situation 
which arose when the premonitory rumblings of 
the collapse in central Europe caused foreign 
balances in London to be called home. It was 
obviously tempting, however, to ascribe to the 



THE MENACE TO DEMOCRACY 257 

extravagance of a government which the business 
world disliked embarrassments arising from the 
blunders of that world itself. Faced with the cry 
that the country was in danger owing to the 
reckless expansion of the social services, the Labour 
Cabinet was unable either to defy the hostility 
of the City, or to take, without being denounced 
as the assassin of British credit, the step of going 
off gold, which its successor took, with the result 
of being hailed as the saviour of British credit. Unlike 
the British Labour government, that of M. Blum 
carried out important reforms. He had to face, 
however, not only the difficulties arising from the 
over-valuation of the franc and from the inter- 
national situation, but the determined hostility 
of Big Business and the refusal to repatriate funds 
sent abroad during the slump. He fell a victim to 
the determination of French capitalism to suffer 
the agreeable agonies of “lack of confidence” so 
long as a socialist premier should remain in power. 
Mr. Roosevelt, in his turn, has been obliged to 
learn another version of the same lesson. He also has 
achieved impressive successes; but he also has dis- 
covered the limitations to the power of a government 
which attempts to make capitalism behave some- 
what less unsocially, while refraining from socializing 
its key positions. He could establish a statutory 
right of collective bargaining, but he could not 
put an end to the terrorizing of trade unionists. 
He could diminish unemployment by public 
expenditure, but he could not prevent capitalists 
from simultaneously increasing it by declining to 
invest. 

It is obviously a long step from the exercise of 
economic duress within the ambit of a democratic 



258 DEMOCRACY AND SOCIALISM 

political system to a frontal attack on that system 
itself. It can hardly be denied, however, that the 
political mentality which approves of the first is 
only too likely, if more seriously alarmed, to look 
favourably on the second. How grave, in particular 
cases, the danger may be, and what form, in given 
circumstances, it is likely to assume, are questions 
not answerable in general terms. The occurrence 
or imminence of war; the course of international 
affairs in time of peace; the economic situation at 
particular moments; the political institutions and 
habits of different countries; the degree to which 
different classes within them share a common 
civilization, all affect the issue. 

The historical assets which British democracy 
commands are obvious and genuine; so also are its 
liabilities. A tradition of civil liberty; a vigorous 
and decentralized system of local government; 
a multitude of voluntary associations accustomed 
to manage their own affairs, may reasonably be 
put on one side of the account. The existence 
of divisions between the life and outlook of different 
classes more profound than in almost any country 
of western Europe; an ingrained social snobbery 
and servile respect for wealth and position; the 
English public school system, with the class loyalties 
it fosters; the tendency of the police, in parts 
of the country, to regard themselves primarily 
as the servants, not of the public, but of the 
wealthier sections of it; the control of the greater 
part of the press by a handful of rich men, are 
to be set on the other. The appalling story of 
the Black and Tans suggests that, if violence were 
thought necessary, the personnel required for the 
purpose would not be deficient; but violence is 



THE MENACE TO DEMOCRACY 259 

not of the essence of the matter. To hamstring 
democracy, it would be sufficient, in the first 
instance, to repeal the Parliament Act, and at the 
same time to deprive the House of Commons of 
its exclusive control over finance. To jump from 
these facts to the conclusion that the victory in 
England of a discreet, gentlemanly Fascism is a 
mere matter of time is to throw up the game before 
it has begun; it is not politics, but panic. It is 
perfectly true, however, that democracy is insecure. 
In a society with such characteristics, it always was, 
and always will be, insecure. 

The source of the dangers confronting it is not 
difficult to discern. It consists in the conflict 
between the claims of common men to live their 
lives on the plane which a century of scientific 
progress has now made possible and the reluctance 
of property to surrender its special privileges. 
The result is a struggle which, while it lasts, 
produces paralysis, and which can be ended only 
by the overthrow either of economic and social 
privilege or of political equality. Democracy, in short, 
is unstable as a political system, as long as it remains 
a political system and nothing more. The politics 
of our age, not only domestic but international, 
are variations on that theme. Liberalism left the 
conflict to take its course; by its refusal to face 
the brutal realities of the economic system, it 
destroyed itself as a party, though it remains a 
moral power. Fascism silences the conflict, by 
silencing its victims; it establishes a servile State, 
in which it purchases the allegiance of capitalism 
to itself by making a present to the capitalists of 
the liberty of the workers. Socialism would end 
the conflict by ending the economic and legal 



26 o 


DEMOCRACY AND SOCIALISM 


conditions by which it is produced. Its fundamental 
dogma is the dignity of man; its fundamental 
criticism on capitalism is, not merely that it 
impoverishes the mass of mankind — ^poverty is an 
ancient evil — ^but that it makes riches a god, and 
treats common men as less than men. Socialism 
accepts, therefore, the principles, which are the 
corner-stones of democracy, that authority, to 
justify its title, must rest on consent; that power 
is tolerable only so far as it is accountable to the 
public; and that diflFerences of character and capacity 
between human beings, however important on 
their own plane, are of minor significance compared 
with the capital fact of their common humanity. 
Its object is to extend the application of those 
principles from the sphere of civil and political 
rights, where, at present, they are nominally 
recognized, to that of economic and social organ- 
ization, where they are systematically and insolently 
defied. The socialist movement and the Labour 
party exist for that purpose. 


(iii) 


The Premise of Socialism 


The most important fact about British socialism 
is so obvious a platitude, that no one with a reputation 
for brilliance to keep up will venture to state it. 
It is that the matters on which nine-tenths of 
socialists are agreed are more numerous, and much 
more important, than those on which they differ. 
It is a universal experience, however, that the 
acceptance of a common goal does little to diminish 



THE PREMISE OF SOCIALISM 261 

the acrimony of disputes as to the best route 
towards it. British socialists frequently conduct 
themselves as though the most certain method of 
persuading the public to feel complete confidence 
in their cause were to convince it that they feel 
no confidence in each other. They draw their 
controversial knives at the first cross-roads 
they encounter, which, if suicide is the object of 
their demonstrations — ^it is often the effect — 
is undoubtedly the right place to choose for the 
purpose. Cross-roads have occurred at somewhat 
short intervals in the last seven years. The dialec- 
ticians, therefore, have had the time of their lives. 
It has all been very clever and ingenious; for those 
with a taste for exhibitions of the kind, it has even 
been amusing. The only people who have got 
nothing out of it whatever are the obscure rank 
and file, who created the Labour movement, and 
for whom it exists. The impression which the 
fireworks make on them, when they are not too 
tired to watch the performance, is one of wearisome 
futility. It is of a silly season unaccountably extended 
from six weeks to six years. 

In so far as not merely emotions, but points of 
principle, have been at issue, they may be reduced 
to two. There has been, in the first place, the 
division between the parliamentary socialism of 
the Labour party and the views — ^rarely stated 
with precision, but often enough hinted — of those 
who suggest that they possess some more trenchant 
alternative to which socialists should have recourse. 
In the second place, there has been the more recent 
controversy, now, it seems, in abeyance, aroused 
by the varying versions of the policy of a Popular 
Front. 



262 DEMOCRACY AND SOCIALISM 

After the collapse of 1931, an epidemic of the 
“infantile disease of Left-wingism” was obviously 
overdue. It raged for some years like measles in 
Polynesia, and set thousands gibbering. Private 
socialisms flourished. There were absurd exhibitions 
of self-righteous sectarianism by cliques thanking 
God — or the latest improvement on Him — that 
they were not as their benighted neighbours, in 
particular, of course, the besotted mandarins 
who conspire against the revolution from their den 
in Transport House. The great game of over- 
trumping the Left of to-day, for fear of not being 
in the swim of to-morrow, went merrily forward 
among the intelligentsia, Bloomsbury — not the 
geographical area, but the mental disease— discovered 
the recondite truth of the existence of a class 
struggle, and announced its conversion to it with 
blood-curdling bleats. Invitations to hunt tigers 
were issued by sportsmen with whom a brave man 
might well hesitate to shoot rabbits. Then, as the 
dictators developed their campaign of international 
blackmail, and British governments truckled to 
them, half in sympathy, half in fear, the hot fit 
passed into a cold. No compromise with capitalism 
had been the motto of yesterday; compromise at 
any cost became the watch-word of to-day. 
Democracy and civil liberty had been derided as 
the illusions of a bourgeois ideology; now they were 
hastily restored to their pedestals by the stern 
iconoclasts who had deposed them. Long reproached 
with an anaemic liberalism, the Labour party 
was denounced for its sectarian reluctance to take 
the Liberals to its bosom. The stalwarts who had 
fumed at the mildness of its socialism protested 
at its intransigence. They implored it to pack up 



THE PREMISE OF SOCIALISM 263 

SO dangerous an explosive, and bury it safely out 
of sight. 

Where the Labour movement is strong, these 
diversions produce less effect than an outsider 
might imagine. They do no good, but they do 
little harm. Its members may applaud the display, 
for they like a good show; but they know by 
experience that barking is not biting, and do not 
allow their enjoyment of the entertainment to 
interfere with business. Where Labour is weak, 
the results are less innocuous. The comrades in 
middle-class Peaceways go off their sleek heads; they 
clamour in refined accents for the social revolution 
— to be conducted, presumably, with walking- 
sticks and perambulators. Little-Puddlington- 
on-the-Wolds is a more tragic case. It has been 
exploited by its masters for the best part of a 
thousand years. If given a fair chance, it might get 
some of its own back. But it hears faint echoes of 
the discordant voices of the competing Rabbis, 
all of whom it thinks wonderful, and none of whom 
it understands. It is then told that, in order to be 
the real thing, it must join hands with the Liberals, 
whom it has just been induced, with some anguish, 
to repudiate, and cultivate the Communists, of 
whom there are two in a town eight miles off. 
It concludes that Labour politics mean nothing 
to it — ^which, if these are Labour politics, is only 
too true — and decides that allotments are more 
useful than meetings. The semi-political public, 
which, as far as elections are concerned, is the 
public that counts, merely shrugs its shoulders. 
It might be won for a cause whose spokesmen 
knew their own minds and talked a language it 
comprehends; but it sees little advantage in voting 



264 DEMOCRACY AND SOCIALISM 

for a parrot-house. As long as the chatter continues, 
it will return neither a Labour government, nor 
a government of the Left, however skilfully 
compounded, in which Labour holds the scales. 

A\^atever the right policies for socialists may be, 
heroics and hysterics are not among them. The 
patients should, of course, be treated by their 
comrades with friendly indulgence; but, if man- 
eaters on the prowl catch an echo of the babel, 
they must be more than ordinarily humane, if it 
does not on occasion make them purr and lick 
their chops. These moods are now on the wane, 
and, even were they not, an attitude of heavy- 
footed heresy-hunting would be the worst way of 
dealing with them. Majority government is the 
only basis on which a party can exist; but to insist 
on too rigorous an orthodoxy is to share the 
responsibility for the vagaries which it causes. The 
Labour movement, as a whole, has shown its sense 
by declining either to make martyrs of its melo- 
dramatists or to take them seriously. It has no 
need to do either. 

Much eloquence and some heat have been 
engendered in recent years by the supposed division 
of the movement into a left wing and a right. 
Whatever the source of such suggestions, nine- 
tenths of them are nonsense. The differences are not 
what they are supposed to be, nor, in so far as they 
exist, have they the importance ascribed to them. It 
is half-a-century or more since the idea that revolu- 
tionary phraseology was the hall-mark of the revolu- 
tionary was hit pretty hard on the head by Marx and 
Engels; but phonographs, unfortunately, have no 
brains to be knocked out, and the noise will go on as 
long as anyone will listen to it. In reality, of course. 



THE PREMISE OF SOCIALISM 265 

what matters most is not what men say, and the 
language in which they say it; it is what they mean 
to do, and the intensity with which they mean it. 
The important point is not that they should 
express — or even hold — opinions as to policy which 
attract attention as “extreme”. It is that they should 
show extreme sense in reaching them, extreme self- 
restraint in keeping their mouths shut till the 
opinions are worth stating, and extreme resolution 
in acting on them, when stated. 

It ought to be possible for a movement, like 
an individual, to be both sensible and trenchant. 
At present, it frequently happens that the virtue 
of each quality is turned into a vice, because the 
proud possessors of one are so intoxicated with 
its charms that they refuse to consider the bare 
possibility of combining it with the other. Until 
the Labour party can persuade its fellow-country- 
men that it represents both — that its idealism is 
not lunacy, nor its realism mere torpor — it vdll 
neither deserve to win general support, nor succeed 
in winning it. Socialism is no longer bad politics 
in England, unless socialists choose to make it so, 
which some of them do with a quite surprising 
ingenuity. But a socialism which is to exercise a 
wide appeal must be adapted to the psychology, 
not of men in general, nor of workers in general, 
but of the workers of a particular country at a 
particular period. It must wear a local garb. It 
must be related, not only to the practical needs, 
but to the mental and moral traditions of plain 
men and women, as history has fixed them. It must 
emphasize primarily what it has in common with 
their outlook, not the points at which it differs 
from them. It must not dogmatize or brow-beat, 



z66 DEMO CJr;A CY AND SOCIALISM 

but argue and persuade. Its spokesmen must 
produce the impression of responsibility and 
consistency which working-class organizations expect 
in the conduct of their own affairs, and which the 
public demands from a prospective government. 
It is too late for the Labour party, at this time of 
day, to conceal its socialism, even if that were its 
wish. What it requires is to create the conviction 
that it can make a good job of it. 

The political psychology with which the British 
socialists have to deal is, no doubt, pretty compli- 
cated; but its essentials, at any rate, are obvious 
enough. Unlike that of central Europe, and still 
more that of Russia, it has been steeped for two 
centuries in a liberal tradition, and the collapse of 
political Liberalism has not effaced the imprint. 
The result is the existence of a body of opinion, 
larger, probably, than in most other countries, 
which is sensitive on such subjects as personal 
liberty, freedom of speech and meeting, tolerance, 
the exclusion of violence from politics, parlia- 
mentary government — what, broadly, it regards 
as fair play and the guarantees for it. The only 
version of socialism which, as things are to-day, 
has the smallest chance of winning mass support, 
is one which accepts that position. Its exponents 
must realize that the class which is the victim of 
economic exploitation, instead of merely reading 
about it, is precisely the class which attaches most 
importance to these elementary decencies. They 
must face the fact that, if the public, and particu- 
larly the working-class public, is confronted with 
the choice between capitalist democracy, with 
all its nauseous insincerities, and undemocratic 
socialism, it will choose the former every time. 



THE PREMISE OF SOCIALISM 267 

They must make it clear beyond the possibility of 
doubt that the socialist commonwealth which 
they preach will be built on democratic foundations. 

That fact is a proof, not of stupidity, but of 
intelligence. It means that Henry Dubb has the 
sense to prefer two good things to one. He knows 
that under dictatorships, whatever the fancy names 
by which they may be called, the only people who 
dictate are the dictators and their friends. In 
becoming a socialist, he has no intention of 
surrendering his rights as a citizen, which, after all, 
he once fought pretty hard to win. But, whether 
admirable or regrettable, that mentality remains 
a fact. Any realist strategy must be based upon it. 
That statement does not imply, of course, that the 
first duty of a socialist is to behave like a sheep. 
Obviously, when the country has put a socialist 
government in power, the business of that govern- 
ment is to see its programme through, and to use 
whatever legal means may be required for the 
purpose. Obviously, the public has not only the 
right, but the duty, to defeat by all possible methods 
unconstitutional resistance to that programme, 
whatever the form such resistance may assume. 
Obviously, if democracy is hamstrung or overthrown, 
the obligations which it imposes automatically 
lapse with it. The only question then is, not of the 
right to use force to restore it to its full power, but 
of the best methods of using force with some chance 
of success. On that question, characteristically 
enough, the paladins of paper revolutions have 
about as much to say as the curate in that ancient, 
but admirable, play, ^he Private Secretary". “If you 
do not behave nicely, I will give you a good, hard 
knock with my umbrella”. 



268 DEMOCRACY AND SOCIALISM 

The practical conclusions which the acceptance of 
democracy as the first premise of socialism involves 
are two. It means, in the first place, that, in the 
absence of an attempt to overthrow democracy, all 
nods, hints, winks and other innuendoes to the effect 
that violence is a card which socialists keep up their 
sleeves, to be played when they think fit, are ruled 
out for good and all. All of them are fatuous, with the 
nauseous fatuity sometimes encountered during war 
in the ferocious babble of bellicose non-combatants. 
Most of them, as the discreet ambiguity in which 
they are muffled is sufficient to show, are a theatrical 
pose, on which the Bobadils who indulge in them 
would be the last persons to act. It means, in the 
second place, that once that line is chosen, socialists 
must adhere to it, when it is not to their advantage 
as well as when it is. In this matter, neither an 
individual nor a party can ride two horses. They 
must make their choice, and must abide, having 
chosen, by the results of their bargain. Obviously, 
the political scales are heavily weighted against a 
party of the Left; but one cannot claim rights which 
one is not prepared to concede, and, unequal as the 
struggle still is in the political field, it is less one- 
sided there than it would be in any other. Given 
the existence of political democracy — ^in its absence, 
of course, different methods would be needed — ^the 
only possible course for socialists is to take the 
rough with the smooth, throw on their opponents 
the odium of tampering with it, and exploit to the 
utmost the possibilities which it offers. Secure in 
the knowledge that they have one chamber to 
themselves, the privileged classes have hitherto 
acquiesced in so much democracy as that absurdity 
permits; but their enthusiasm for it remains this 



THE TASK BEFORE THE LABOUR PARTY 269 

side idolatry. For socialists to give the impression 
that they too have reservations would be to make 
them a present of what, as things are to-day, should 
be one of socialism’s chief assets. 


(iv) 

The ‘Task before the Labour Party 

In insisting that socialist policy must be based on 
these truisms, the Labour party has shown greater 
realism than some of its critics. Its most serious 
weakness is not difficult to state. It lies neither in 
its programme, which is sound enough, nor in its 
view of political strategy, which, as far as the 
Great Britain of to-day is concerned, is the only 
view possible. It consists in its attitude to the 
popular forces which should be its strength. It is 
that, while accepting, quite rightly, the democratic 
premise, it does not act with sufficient remorseless- 
ness on the full rigour of its own argument. If it is 
to do the job for which it was created, it must 
accomplish three things. It must be returned to 
power. It must succeed, when returned, in carrying 
out its programme. It must defeat such attempts, 
whether by way of economic sabotage or by more 
overt methods, as may be made to frustrate it. It 
will not do either except as the spearhead of a strong 
body of conviction, which will not only vote it 
into office, but stand by it when the pinch comes. 

It is improbable that a third Labour government 
would be guilty of the same follies as ruined its 
two predecessors; the reefs, and the wreckage on 
them, will for long be too plain. Obviously, it must 



Z 70 DEMOCRACY AND SOCIALISM 

make it evident from the start that it intends to 
act on the full programme, international and 
social, advanced at the election. To give the 
impression that it will play fast and loose with its 
engagements in order to retain office, is to make 
its opponents the censors of its policy and to invite 
unending blackmail. It must be prepared to live 
dangerously, and, whatever it does, there is one 
thing it must not do; it must on no account remain 
in power merely on sufferance. Obviously, again, 
it must fight on large issues, and fight at once. 
Either it means a decisive break with the whole 
policy of capitalist governments, or it means 
nothing at all. It is essential that it should make 
clear at once, while its prestige is still high, and its 
moral unimpaired, the new course in international 
and social affairs which it intends to steer. 

With the world sliding as it is, to discuss the first 
in detail is clearly impracticable; but its broad 
outlines, at least, can hardly be in doubt. A delicate 
insight into the political psychology of other 
nations is not usually regarded as Germany’s strong 
suit; but, in recent years at any rate, she appears 
to have sized up pretty accurately the British 
governing classes. The policy of the dictators 
has been to play on the sympathies and fears of 
British conservatism; by immobilizing Great Britain, 
to immobilize France; to use colonial demands as 
a counter to be bartered in due course for a free 
hand on the Continent; and thus, having paralysed 
the two powerful democracies, to prepare the 
way for brigandage in Spain, central Europe or 
Russia, and to impose their will piece-meal on the 
weaker nations. That strategy has already produced 
two wars, those in Abyssinia and Spain, while the 



THE TASK BEFORE THE LABOUR PARTY 271 

distraction in Europe which it has caused is in 
large measure responsible for the war in the Far 
East. Unless it is arrested, other victims will be 
marked down — ^perhaps, indeed, already have been — 
and other wars will follow. 

It cannot be checked by merely waiting on events, 
but only by organizing the powers which desire 
peace. The essential points are four. First, a Labour 
government, though it cannot re-establish the 
League by a stroke of the pen, can and should re- 
establish a common front, with France, Russia and 
Great Britain as its nucleus, based on the League 
principle of united resistance to aggression, and 
invite all states which accept that principle to 
associate themselves with them. Second, it should 
inform Germany that it is not only willing, but 
anxious, to redress all those of her grievances which 
can be removed without injustice to other nations, 
and invite her to state in plain language what 
precisely her present grievances are. It should at 
the same time make clear both to Germany and 
Italy that the happy days when bluff and menaces 
were a conclusive argument have come to an end; 
that they will be welcomed as members of an 
association of states of the kind outlined above, if 
they accept its principles; but that, if they persist in 
threatening war where they please, they must not 
count on their next victim standing alone. Third, 
it should make a determined effort to reach a firm 
understanding with the United States and Russia 
on the subject of the Far East. Fourth — a matter 
which affects all others — ^it should overhaul its 
commercial and colonial policy, and free it from 
the features which expose it to the charge of 
an excessive nationalism. 



ijt DEMOCRACY AKD SOCIALISM 

In the sphere of social policy prompt and resolute 
action is equally indispensable. The characteristic 
failing of Labour governments is an exaggerated dis- 
cretion. The impression made by them on an observer 
recalls the picture of the young person portrayed 
by Jane Austen, of whom nothing could be said 
but that “his countenance was pleasing and his 
manners gentleman-like”. They walk as delicately 
as Agag, like cats on ice. They behave like men 
afraid to exercise the power which they have 
struggled for a generation to win. They are less 
anxious to satisfy their friends than to placate 
their enemies. They are portentous over trifles, 
scrutinize farthings under microscopes, and baulk 
at hedges which their opponents would take in 
their stride, with a laugh or a curse. The latter have 
been brought up to believe that they are the elect, 
and are not troubled by the thought that they may 
possibly be mistaken. If they decide to throw 
money away, they throw it away with a hearty 
gesture; if they think it advantageous to pass an 
unworkable Act, they pass it, and damn the conse- 
quences. They listen to criticism politely enough; 
but, except in the merest details, they are not 
deflected by it. They know that, once in the saddle, 
they can do what they please. They proceed to do 
it, with a smiling indifference to the remonstrances 
of their experts, the fury of the opposition, the facts 
of geography, arithmetic and other vulgar sciences, 
and the merits of the case. 

That attitude of tranquil assurance is a consider- 
able asset. Some of its virtues might be imitated 
with advantage by the next Labour government. 
Such a government will necessarily, of course, have 
to deal immediately — to mention only two topics — 



THE TASK BEFORE THE LABOUR PARTY 273 

with gross scandals, like the household means test, 
and with measures of reform such as the raising of 
the school age and the abolition of fees in secondary 
schools, which are old items in its programme, and 
are long overdue. But it would be fatal for it once 
more to evade the task of effecting a real transference 
of economic power, on a substantial scale, from 
private to public hands. Before it can be master, it 
must show that it can capture some of the strong- 
holds of capitalism, as well as make inroads on its 
outworks. It is more important that it should do a 
few big things with success than that it should 
attempt a large number and leave them half-done. It 
may reasonably be hoped, however, that, in addition 
to making the Bank of England a public institution, 
in form as well as in fact, it will find time to 
nationalize at any rate armament-making, coal and 
•power, transport and land; create a Planning 
Department; and establish an effective system of 
control over the major industries remaining in 
private ownership. What most matters on a long 
view is not that it should nationalize an imposing 
list of industries, but that it should shatter the 
halo of mystery which at present surrounds capitalism 
in the eyes of the simple, by decisive and un- 
mistakable victories at a few well-chosen points. 
If it succeeds in doing that, the mopping up of the 
remainder will follow in good time. 

Labour will not, however, win power in the first 
instance, nor be in a position to use it, when won, 
with the vigour required, unless it has behind it, 
not merely a majority of votes, but a temper in 
the country which will see the job through. The 
plutocracy consists of forcible, astute, self-confident, 
and, when hard-pressed, unscrupulous people, who 



274 DEMOCRACY AND SOCIALISM 

know pretty well which side their bread is buttered, 
and intend that the supply of butter shall not run 
short. If their position is seriously threatened, they 
will use every piece on the board, political and 
economic — the House of Lords, the Crown, the 
press, financial crises, allegations of disaffection in 
the army, international complications — ^in the honest 
belief that they are saving civilization. They will 
probably yield, though only after two elections, to 
an overwhelming demonstration of opinion, in 
which the public shows its teeth; but, as far as major 
issues are concerned, they will yield to nothing 
less. Such opinion cannot be improvised. If it is 
to be available in an emergency, it must be prepared 
in advance; nor, until it exists, will a Labour 
government be returned. Part of the function of 
the Labour party in opposition should be to create 
it. 

To succeed in that task, it need not change its 
policy, but it must strike a somewhat different note. 
It must combine two appeals which are sometimes 
contrasted, but which, in fact, should help each 
other. It must show, in the first place, not less of 
the statesman, but more of the tribune. For all 
its democratic faith, the Labour party has been 
disposed to acquiesce in a conception of democracy 
which assigns to it a rdle rather passive than active. 
It is apt to be so much exasperated with the young 
lions who roar only in order to be noticed, that it 
sometimes relapses into cooing like any dove. It 
soothes the dog with caresses, when it ought to be 
educating him to know burglars when he sees them, 
and to fly at their throats. That easy-going amiability 
is suitable enough in its opponents. They depend 
on a vote which is largely non-political, and passivity 



THE TASK BEFORE THE LABOUR PARTY 275 

is the mood which best suits their book. In a party 
which appeals to men, not to follow habits, but 
to break them, such an attitude is fatal. If natural 
in an age when democratic institutions seemed 
secure beyond challenge, it is now out of date. 
Nor, as long as it obtains, will a socialist govern- 
ment have behind it the dynamic required to 
translate its programme into action. 

Parties appear in different rdles at different 
stages of their history. They may spring, as the 
Labour party sprang, from a profound popular 
movement; but naturally and properly they become, 
if the^ grow, more efficient as electoral machines; 
and, in proportion as office turns from a distant 
goal into a practical possibility, the relative 
importance of these two aspects of their work 
undergoes a change. That change is, in part, both 
unavoidable and beneficial. To secure the chance 
of doing constructive work, a party must win a 
majority. It is inevitable that, as its electoral 
prospects improve, they should claim a larger 
share of its attention. Its danger then is that 
unconsciously it may relapse into the belief that the 
winning of a majority is its only task, and that, 
once a majority is won, all else will follow. It is 
tempted to regard the movement which created it 
as primarily existing to maintain the political 
party, not the party as existing for the sake of 
the movement, which must constantly be vitalised 
if either is to prosper. Determined that the machine 
shall roll smoothly to success along the track laid 
down, it becomes needlessly exasperated with 
enthusiasts who distract attention from the task 
in hand, and sometimes appear to it to throw grit 
into the bearings. 



276 DEMOCRACY AND SOCIALISM 

That reaction is inevitable, and has some justifica- 
tion. Politics have a business side, and political 
business must be efficiently done. Trade unions, 
again, throughout their history, have had a double 
aspect; they have been both professional associations 
and organs of revolt. It cannot be expected that their 
officers should feel much affection for interfering 
outsiders, who enjoy the thrills of industrial agita- 
tion, while leaving to others its risks and responsi- 
bilities. It should be equally obvious, however, 
that the concentration of interest on immediate 
electoral prospects can easily be overdone, and that 
to sacrifice to them the dissemination of ideas in 
the movement as a whole is ultimately to injure 
both. Democracy ought not to be regarded merely 
as a political mechanism — a mechanism which, 
indeed, it is important to preserve, but which, 
in the absence of a Fascist revolution, can be taken 
for granted. It ought to be envisaged as a force to 
be released. The Labour party, in particular, should 
think of it, not merely in terms of ballot-boxes and 
majorities, but as a vast reservoir of latent energies — 
a body of men and women who, when inert, are a 
clog, but may become, once stirred into action, a 
dynamic of incalculable power. Its function is not 
merely to win votes; it is to wake the sleeping 
demon. It is to arouse democracy to a sense both of 
the possibilities within its reach and of the dangers 
which menace it; to put it on its mettle; to make it 
militant and formidable. In attacking the oldest and 
toughest plutocracy in the world. Labour is 
undertaking, on any showing, a pretty desperate 
business. It needs behind it the temper, not of a 
mob, but of an army. 

If it is to create that temper, it must not prophesy 



THE TASK BEFORE THE LABOUR PARTY 277 

smooth things; support won by such methods is a 
reed shaken by every wind. It must promise less 
and demand more. It must say less of what it will 
do, if returned to power, and more of the res- 
ponsibility which rests on the public to see that 
governments, who are its servants, for once in a 
way serve it. It must treat electors not as voting- 
fodder, to be shepherded to a polling station, and 
then allowed to resume their slumbers, but as 
partners in a common enterprise, in which the party, 
indeed, will play its part, but the issue of which 
depends ultimately on themselves. It must explain 
to them — not, of course, in a hysterical falsetto, 
but with gravity and candour — the character of the 
opposition which will confront a Labour govern- 
ment, and appeal to them, if they believe in 
democracy, to see it through a crisis compared with 
which the Zinoviev letter and the press campaign 
of 1931 will prove, it may be anticipated, to have 
been skirmishes of outposts. In order, in short, to 
tackle its job with some hope of success, it must 
mobilise behind it a body of opinion as resolute and 
well-informed as the opposition in front. To achieve 
that result, it must become, not less, indeed, of an 
electoral machine — for electioneering is important — 
but more of a movement and a crusade. 

It must be a movement, in the second place, in 
which fervour of conviction is combined with 
tolerance of temper and generosity of outlook. 
It must make it evident that it stands for a better 
civilization, in which all can share who pull their 
weight in the boat, not merely for the defence of 
interests, however important, which to-day are 
neglected. That attitude is implied in the socialism 
of the Labour party, is embodied in its programmes, 



278 DEMOCRACY AND SOCIALISM 

and is in the best interests of the workers them- 
selves, since — as the reaction of 1931-35, with its 
onslaught on the social services, was sufficient to 
demonstrate — ^while the plutocracy is in the saddle, 
no reforms are secure. It cannot, however, be too 
constantly emphasized. The Labour party can 
either be a political agent, pressing in parliament the 
claims of particular groups of wage-earners; or it 
can be an instrument for the establishment of a 
socialist commonwealth, which alone, on its own 
principles, would meet those claims effectively, 
but would not meet them at once. What it cannot 
be is to be both at the same time and in the same 
measure. So far from risking the loss of support by 
underlining that obvious truth, it has everything 
to gain by a more general appreciation of it. By 
emphasizing it, it would appeal to the idealism of 
the rank and file of its supporters. It would add to 
them recruits whose aid is essential if its objects are 
to be achieved. 

A considerable section of the public still thinks of 
the Labour party primarily as a trade union 
party, and, without being hostile to trade unionism, 
does not feel at home with it. The teacher, the doctor, 
the scientist, have no love for capitalism; they see 
its consequences too close. They realize the un- 
ending frustration of human possibilities, the 
misapplication of the achievements of science, and 
the waste of national resources, which the direction 
of economic effort for the gain of the profit-maker 
necessarily involves. They may feel little enthusiasm 
for equality in the abstract; but they know the 
new energies which could be released by providing 
for all the same opportunities of health and education 
as are at present enjoyed by a small section of the 



THE TASK BEFORE THE LABOUR PARTY 279 

nation, and they have seen both services dehberately 
starved to save the pockets of the rich. They regard 
the thought of war with horror, and are aware that 
the sabotage of the League of Nations, with the 
general scuttle into armaments which was its 
inevitable result, has brought war nearer. While, 
in short, they are little interested in industrial 
issues, which are remote from their experience, they 
care intensely for peace and good government. They 
would welcome a policy by which their country 
took the lead in re-establishing the foundations of 
an international system based on law, and of a social 
system in which surplus wealth is used, not to enrich 
a minority, but for the common good. 

Such men are numerous in all walks of life. 
Whether they know it or not, they are natural 
socialists. What at present holds them back from 
active partnership in the Labour movement is 
not dissent from its aims, but doubts as to its 
practice. It is the fear that a Labour government 
may be dominated, like any other, by sectional 
interests, and that its policy, if less selfish than that 
of its capitalist opponents, may be equally short- 
sighted. If their support is to be won, those 
apprehensions must be removed. It is not a question, 
of course, of giving a second place to the claims of 
the industrial workers, who are capitalism’s chief 
victims, but of presenting those claims as what in 
essence they are, a demand for a life that is worthy 
of human beings, and which no decent man will 
withhold from his fellows. The appeal to them, in 
short, must be based upon principles, which unite 
men who in interest and experience may be poles 
asunder. For the Labour party at this stage to 
follow the advice to put its socialism in cold storage 



i8o DEMOCRACY AND SOCIALISM 

would not only be to incur their well-deserved 
contempt on the score of insincerity; it would be 
to suppress precisely that part of its case which 
makes the strongest appeal to men whose business 
in life is, not snatching at profits, but constructive 
activity. 

That appeal, with the world as it is, is not difficult 
to make. What confronts us to-day is not merely 
the old story of the rivalries of ambitious nations, 
or the too familiar struggles of discordant economic 
interests. It is the collapse of two great structures 
of thought and government, which for long held 
men’s allegiance, but which now have broken down. 
The first is the system of independent national 
states, each claiming full sovereignty as against 
every other. The second is an economic system 
which takes as its premise that every group and 
individual shall be free to grab what they can get, 
and hold what they can grab. Those methods of 
organizing the affairs of mankind may be admired 
or detested, but two facts are incontestable. In 
the past they worked, though with endless waste 
and ill will; they now work no longer. The result 
is the anarchy, international and economic, which 
threatens to overwhelm us. A government may 
temporarily secure the support of a majority of 
the nation by success in diverting attention from 
the nightmare. No movement or party wiU deserve 
that support, unless it can offer some reasonable 
hope of attacking with courage the causes which 
produce it. 



NOTES ON PREFACE. 

1. A. C. Pigou, Socialism versus Capitalism^ 1937, p. 138. 

2. See p. 63. 

3. See p. 56. 

4. Report of Committee on National Expenditure, 1931, p. 192. 

NOTES ON CHAPTER I (pp. 1-38) 

1. Matthew Arnold, Lecture on “Equality,” in Mixed Essays, 
cd. 1903, pp. ix, 48-97. 

2. Op, cit., p. 51; E. Thring, Education and School, 1864, 
pp. 4-5; Bagehot, 7 he English Constitution, 1867, pp. 50-4; 
Erskine May, Democracy in Europe, 1877, vol. ii, p. 333; Lecky, 
Democracy and Liberty, 1899, vol. i, pp. 256-7; Taine, Notes sur 
VAngleterre, i^J2, p. 189, and Histoire de la Litthature anglaise, 
1863, vol. iii, p. 650. 

3. F. Clarke, “An Elementary-Secondary School,” in Hibbert 

Journal, Oct. 1927, p. 145, and A Dominion View of English 
Education, an address delivered to the College of Preceptors, 
Feb. 14, 1929, reported at length in Cape Limes, May 3 and 4, 
1929; U.S.A., Special Report of Commissioner of Labour on 

Regulation and Restriction of Output, 1904, pp. 810-11, and B. 
Austin and W. F. Lloyd, Lhe Secret of High Wages, 1926, intro- 
duction (by W. T. Layton) and pp. 43, 75, 102, 107; W. Dibelius, 
England, 1929, pp. 205-7; E. Wertheimer, Portrait of the Labour 
Party, 1929, pp. 138, 139; A. Siegfried, L*Angleterre dlaujourdlhui, 
1924, p. 251. See also E. Banks, School for John and Mary, 1924. 

4. H. G. Wells, Lhe Open Conspiracy, 1928, p. 77. 

5. See the remarks of H. de Man, Au deld du Marxisme, 1927, 

p. 89. 

6. Sir E. A. Parry, The Lazo and the Poor, 1914. 

7. Lord Birkenhead, reported in The Times, Sept. 30, 1927, 
and Nov. 17, 1928; J. L. Garvin, article in the Observer, July i, 
1928; E. J. P. Benn, The Confessions of a Capitalist, 1926, pp. 188, 
189; Sir Herbert Austin, article in Daily Herald, May 13, 1930; 
Dean Inge, reported in Evening Standard, May 8, 1928. 

8. Cyril Burt, The Distribution and Relations of Educational 
Abilities, L.C.C., 1917; Report of the Mental Deficiency Committee, 
H.M. Stat. Off., 1929. 


281 



282 


NOTES 


9. Mill, Principles of Political Economy y ed. 1865, bk. iv, 
chap, vi, and Autobiography y ed. 1909, p. 133. 

10. See the Report of Consultative Committee of BA of Educ. on 
Psychological Tests of Educahle Capacity y 1924, p. 71: “All our 
witnesses are agreed that intelligence does not cover tempera- 
ment or character, and that, therefore, the important personal 
qualities of will, feeling and emotion are not dealt with by tests of 
intelligence.” 

11. For a valuable discussion of recent work on the subject, 
see M. Ginsberg, “The Inheritance of Mental Characters,” in 
The Rationalist Annualy 1930, pp. 47-54. 

12. M. Ginsberg, The Problem of Colour in relation to the idea 
of Equality (Journal of Philosophical Studtesy Suppt. to vol. i, 
no. 2), 1926, p. 14. 

13. See the discussion of Pareto’s Law in Pigou, Economics of 
WelfarCy ed. 1929, pp. 645-53, and the passages in Pareto’s Manuele 
di economia politica there quoted. 

14. Benn, op, ciUy p. 237. 

NOTES ON CHAPTER II (pp. 39-91) 

1. A. M. Carr-Saunders and D. Caradog Jones, A Survey of the 
Social Structure of England and WaleSy 1927, p. 71. 

2. Bryce, The American Commonwealth, 1917, vol. ii, p. 297. 

3. W. Woytinsky, Die Welt in Zahlen, 1926, bk. ii, pp. 46-7. 

4. Bowley and Stamp, The National Income, 1927, p. 12; 
Carr-Saunders and Jones, op, cit,, pp. 61-3. 

5. Report on Economic Conditions in France in ig28y by J. R. 
Cahill, H. M. Stat. Off., 1928, p. 225. For the English figures of 
occupying ownership, see Clapham, An Economic History of Modern 
Britain, Vol. Ill, p. 534. 

6. For the statistics in this paragraph, see J. Stamp, Wealth 

and Taxable Capacity, 1922, pp. 101-2; H. Clay, “The Distribu- 
tion of Capital in England and Wales,” in Manchester Statistical 
Soc, Trans,, 1924-6, p. 73; Carr-Saunders and Jones, op, cit,, 
pp. 113-16, 165-7; I* Cole, The Condition of 

Britain, 1937, pp. 77-9; J. Wedgwood, The Economics of 
Inheritance, 1929. 

7. Bowley, The Change in the Distribution of the National 
Income, 1880-igiS, 1920, p. 22; Stamp, op. cit,, p. 95; Colin Clark, 
National Income and Outlay, 1937, p. no. 

8. See pp. 164-6; and Cole, op, cit,, p. 95, 



NOTES 


283 

9. H. J. Laski, The Personnel of the English Cabinet^ 1801- 
1924 (reprinted from Amer» PoL Sci. Rev,, vol. xxii, no i), 1928, 
pp. 18-19. 

10. A. Cecil, British Foreign Secretaries, i8oy-igi6, 1927, p. 1 34; 
R. T. Nightingale, “The Personnel of the British Foreign Office 
and Diplomatic Service, 1851-1929”, in The Realist, Dec. 1929, 
pp. 333-4, 341, 343; M. Ginsberg, “Interchange between Social 
Classes,” in Econ, JL, Dec. 1929, p. 563. 

11. See Appendix I. 

12. See report in Manchester Guardian, Nov. 15, 1929, of 
evidence submitted by Civil Service Commissioners to the Royal 
Commission on the Civil Service. For the years 1906-10 the 
percentage was 74. 

13. R. F. Cholineley, “The Boys* Day School,” in The Schools 
of England, ed. J. Dover Wilson, 1928, pp. 1 13-14; Rev. F. A. 
Nairn, reported in Times Educ. Suppt., May 5, 1928. 

14. De ToequeviUe, Democracy in America, trans. H. Reeve, 
ed. 1898, vol. ii, bk. ii, chap. ix. 

15. Clive Bell, Civilization, 1928. 

NOTES ON CHAPTER III (pp. 92-135) 

1. De ToequeviUe, Uancien Regime, 1856, p. 128. 

2. Burke, Letter to Duke of Richmond, Nov. 17, 1772, in Works, 
ed. 1852, vol. i, p. 190; Young, Eastern Tour, 1771, vol. iv, p. 361; 
Hansard, 1807, vol. ix, pp. 798 (Mr. Davies Giddy) and 544 
(Mr. Sharpe). 

3. F. J. Turner, The Frontier in American History, 1921. 

4. Bentham, Principles of the Civil Code (in Works, 1843, vol. i), 
chap. xii. 

5. J. M. Keynes, The Economic Consequences of the Peace, 1920, 
p. 9. 

6. Sir H. Maine, Popular Government, 1885, p. 50. 

7. M. Ginsberg, “Interchange between Social Classes,” in 
Econ. Jl., Dec. 1929, pp. 554-62, 565. 

8. The table on the foUowing page gives the Board of Education’s 
classification of the occupations of fathers of pupils in secondary 
schools on the grant list on Jan. 31, 1913, and March 31, 1926 
{Statistics of Public Education, 1920-1, Table 88, p. 90, and 
1925-6, Table 63, p. 52). 

9. S. J. Chapman and F. J. Marquis, “The Recruiting of the 
Employing Classes from the ranks of the Wage-earners in the Cotton 



284 


NOTES 


Industry,” in Stat, JL^ Feb. 1912, pp. 293-6; Carr-Saunders and 
Jones, op, cit,y p. 143. 

10. Sir J. Fitzjames Stephen, Liberty^ Equality^ Fraternity^ 
1873, pp. 233, 234. 

11. H. See, Les Origines du Capitalisme moderne^ 1926, p. 183. 

12. Ginsberg, Fhe Problem of Colour (see above, note 12 on 
Chap. I), p. 15. 


{Continuation of Note 8, p, 283) 


Occupations of Fathers. 

Boys. 

Girls. 

Jan. 31, 
1913. 

March 31, 
1926. 

Jan. 31, 
1913. 

March 31, 
1926. 

(i) Ministers of Religion . 

2*0 

1*3 

2 *0 

1*4 

(ii) Teachers 

3-9 

3*4 

4*2 

3 7 

(iii) Members of other professions 

12-9 

12-5 

13*0 

13*2 

(iv) Farmers 

5-5 

4-6 

5*0 

4 7 

(v) Wholesale Traders 





(Proprietors and Managers) . 

10*0 

7*1 

9*6 

7*0 

(vi) Retail Traders .... 





(Proprietors and Managers) . 
(vii) Traders’ Assistants 

19*2 

i6*2 

i 8*7 

*5*5 

I ‘O 

2 *0 

1 *0 

2 *0 

(viii) Contractors 

2-3 

2*7 

2*3 

2*7 

(ix) Minor Officials 

4*9 

4*0 

47 

3*8 

(x) Clerks and Commercial , . 




Travellers and Agents . 

13*9 

14*2 

13*2 

13*3 

(xi) Postmen, Policemen, Sea- 





men and Soldiers . 

2*2 

3*8 

2*3 

3*8 

(xii) Domestic and other Servants 

1*9 

2*2 

2 -O 

2 *2 

(xiii) Skilled Workmen .... 

163 

21 -O 

17 -o 

21 *1 

(xiv) Unskilled Workmen ... 

2-4 

4*0 i 

2 *6 

4*1 

(xv) No occupation given . 

I -6 

I -o 

2*4 i 

J-5 

Total 

100 

lOO 

100 

100 


1 3 . Irving Fisher, Elementary Principles of Economics ^ I9i2,p.5i3. 

14. Lord Inchcape in 7 he iimesy April 28, 1930. 

15. See the warning given by the Consultative Committee of 
the Board of Education as to the caution needed in comparing 
the results of intelligence tests applied to children coming from 
different environments. “The results of intelligence tests applied 
to children . . . some of whom were underfed and ailing, while 
others were well nourished and healthy, would necessarily afford 















NOTES 285 

untrustworthy evidence of inborn capacity” {Psychological Jests oj 
Educahle Capacity^ ^924? P* 75 *) 

16. E. D. Simon, How to Abolish the Slums, 1929, pp. 12-13; 
Report of Chief Med, Off. of Bd. of E due, for ig28, p. 144. The 
number of children found in the course of routine inspections to 
be in need of treatment (excluding dental disease) in 1928 was 
395,658 out of 1,912,747 inspected. Assuming the proportion to 
be the same among the children who were not inspected, the number 
suffering from defects among the total school population of England 
and Wales (4,981,101) would be 1,030,357. 

17. E. Cannan, Jhe Economic Outlook, 1912, p. 249; H. D. 
Henderson, Inheritance and Inequality, 1926, pp. 12-13; E. D. 
Simon, Jhe Inheritance of Riches, 1925, p. 15; J. Wedgwood, 
“The Influence of Inheritance on the Distribution of Wealth” in 
Econ, Jl,, March 1928, pp. 50, 52, 55 (the italics are mine), and 
(for a more detailed discussion) his Economics of Inheritance, 
chap. vi. 


NOTES ON CHAPTER IV (pp. 136-97) 

I. Wedgwood, Jhe Economics of Inheritance, pp. 9, seq. 

1 . Report of Commission on Coal Industry, 1926, p. 8i; Bowley, 
Jhe Division of the Product of Industry, 1919, p. 49. For the 
expenditure on Social Services, see below. Appendix H. 

3. U.S.A., Report of Committee on Recent Economic Changes of 
the President's Conference on Unemployment, 1929, vol. i, p. 19. 
See also P. H. Douglas, Jhe Movement of Real Wages and its 
Economic Significance (reprinted from Amer. Econ. Review, vol. xvi, 
No. I, Suppt., March 1926), p. 40. 

4. E. F. M. Durbin, “The Social Significance of the theory of 
value,” in Jhe Economic Journal, Dec., 1935, pp. 700-710. 

5. Report on the Sanitary Condition of the Labouring Population, 
1842, p. 43. 

6. First Report of Commission on the State of Large Towns, 1844, 
p. 30; W. S. Jevons, The Coal Question, ed. 1906, pp. xlvii, 1 . 

7. Sir John Simon, English Sanitary Institutions, 1890. 

8. Extracts from Minutes of Proceedings of Privy Council on 
Education, 1839, p. 2; C, Birchenough, History of Elementary 
Education, 1920, p. 115, 

9. See the table in Report of Committee on National Debt and 
Taxation, 1927, pp. 94-5, and the explanation of it there given. 

10. Colin Clark, op, ciu, pp. 145-6. 



286 


NOTES 


11. Herbert Spencer, ^he Man versus the State^ 1884, p. 22. 

12. For the figures in this and the following paragraphs, see 
Appendix 11 . 

13. Carr-Saunders and Jones, op. cit.y pp. 165, 167. For later 
figures see Cole, op. cit.y p. 77. 

14. Report of Committee on National Debt, p. 105. 

15. Ibid.^ p. 100. 

16. Colin Clark, op. cit.^ p. 148. 

17. Report of Chief Med. Off. of Min. of Health for ig2ly p. 15. 

18. Corporation of Glasgow, Risumi of Work of Public Health 
Department^ 1926-7, p. 16. 

19. Dr. Veitch Clark, reported in Manchester Guardian^ June 
25, 1927. 

20. I take these figures from an article by Dr. H. Roberts 
{Daily Herald^ Aug. 4, I 937 .)- 

21. Sir A. Newsholme, Phe Elements of Vital Statistics, ed. 
1923, pp. 258, 294, 320; Report of Chief Med. Off. of Bd. of Educ. 
for 192 J, p. 96; Dr. Kerr, The Fundamentals of School Health, 

1926, pp. 361, 632 seq.*. Dr. Veitch Clark, see note 19; 
C. P. Childe, Environment and Health, 1924, p. 12; Privy Council 
Medical Research Council. The Relations between Home Conditions 
and the Intelligence of School Children, by L. Isserlis, 1923, pp. 6, 18. 

22. See the interesting figures as to the effect of milk meals given 
to the children in London schools, in Report of Chief Med. Off. of 
Bd. of Educ. for 192J, pp. 119-20. 

23. Sir A. Newsholme, Health Problems in Organised Society, 

1927, pp. 82-3, 30-1. 

24. E. D. Simon, How to Abolish the Slums, 1929, p. 2, and 
chaps, iv. and xi. 

25. H. W. Household, quoted in Daily Herald, May 12, 1927. 

26. Report of Consultative Committee of Bd. of Educ. on Books in 
Public Elementary Schools, 1928, pp. 65-7. 

27. House of Commons, Standing Committee A, March 24, 1936, 
p. 56. 

28. Report of Consultative Committee on the Primary School, 1931, 
p. xxix. 

29. H. Dalton, Some Aspects of the Inequality of Incomes in 
Modem Communities, 1920, pp. 25-6, 174 seq., 246 seq. 

30. This appears to be the view of Sir William Beveridge. 
Sec his “Unemployment”, in The Political Quarterly, vol. i, no. 3, 

pp- 336-7- 

31. See Report of Committee on National Debt, p. 375. 



NOTES 


287 


32. Ibid.^ p. 244. 

33. Report of British Association for ig 2 Iy p. 273. 

34. A. C. Pigou, Socialism versus Capitalism, 1937, pp. 137-8. 

35. Report of Chief Med, Off, of Min, of Health for ig 33 , p. 14; 
F. E. Fremantle, ^he Health of the Nation, 1927, chap. v. Dr. 
Fremantle estimates the total cost of sickness roughly at 
^{^300,000,000, a third of which is preventable. 

36. Report of Committee on National Debt, p. 241. 

37. See Colin Clark, National Income and Outlay, pp. 185-6. 

NOTES ON CHAPTER V (pp. 198-246) 

1. H. Kessler, Walter Rathenau, 1928, p. 121. 

2. For the German figures for 1925, see Wirthschaft und 
Statistik, 1929, p. 36, and for the earlier years W. Sombart, 
Die deutsche Volkswirthschaft im neunzehnten Jahrhundert, 1921, 
Anlage 22, pp. 506-7. For the American figures see the Biennial 
Census of Manufactures for ig23, 1928, p. 1221. 

3. Committee on Industry and Trade, Factors in Industrial and 
Commercial Efficiency, 1927, p. 4; Report of Royal Commission on 
the Coal Industry, 1926, p. 47. 

4. Report of Committee on Trusts, 1919, pp. 2, 8-9; Factors in 
Industrial and Commercial Efficiency, 1927, pp. 1 10-14. 

5. For evidence on these points see U.S.A., Final Report of 
Commission on Industrial Relations, 1916; Report of the Steel Strike 
of igig and Public Opinion and the Steel Strike (Reports of the 
Commission of Inquiry, Interchurch World Movement), New 
York, 1920 and 1921 ; H. C. Butler, Industrial Relations in the 
United States (I.L.O., Studies and Reports, Series A, no. 27), 1927. 
The quotation from Mr. Justice Brandeis occurs in the Final 
Report on Industrial Relations, p. 63. 

6. Manchester Guardian, Jan. 8, 1930. 

7* A. F. Pollard, The Evolution of Parliament, 1920, pp. 183-4. 

8. Manchester Guardian, Jan. 29, 1930. 

9. Federated American Engineering Societies, Waste in Industry, 
1921, p. 9. 

10. Britain's Industrial Future, 1928, p. 85. 

11. C. S. Orwin and W. R. Peel, The Tenure of Agricultural 
Land, ed. 1926, p. 7. 



288 


APPENDIX 




X s 

g a 

z s 

<3 H 



aunty Court Judges, Recor- 
ders, Metropolitan Magis- 
trates, Stipendiary Magis- 
trates (215) 









APPENDIX I 


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Home Civil Servants (Mem- 
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ceiving ;^i,ooo a year and 
upwards) (455) 

Members of Indian Civil Ser- 
vice (English names only) 

(loS) 

Governors of Dominions (65) 

Directors of 5 Banks (165) 

Directors of 4 Railway Com- 
panies (91) 

Total 


o 

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^ 2 
4-* CO 


2S9 







Total expenditure expressed 

m price level of 1890 4,605 6,387 9,767 16,063 26,972 48»o7+ 4i>o32<“> 167,033 1245,592 I 242,505 


APPENDIX II 


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INDEX 


Agriculture, 54, 243 
Aristotle, 28 

Arnold, Matthew, i, 2-3, 10, 12, 15, 

24, 36 

Athens, 77, 80-1, 87, 88 
Austin, Sir Herbert, 19 
Australia, 52, 53, 57, 183 

Bagehot, W., 2 

Banking, 206, 207, 243, 244, 273 

Bell, Clive, 77-8, 8i 

Benn, Sir Ernest, 19, 21, 30-1, 34, 

35, 36 

Bcntham, 106 
Birkenhead, Lord, 19 
Blum, 257 

Bourgeoisie, 94, 95-6, 103 
Bowley, A. L., 53, 63, 139, 143 
Brandeis, Justice, 216 
Bryce, Lord, 43 
Burke, 87, 96, 164 
Burt, Cyril, 22, 167 
Business unit, size of, 60, 204-5 

Cabinet Ministers, 67-8 
Cannan, £., 134 

Capital, provision and investment of, 
189, 194-7 

Carr-Saunders, A. M., 41, 57, 117, 158 
Cecil, Algernon, 68 
Chadwick, 150, 152 
Chapman, Sir S. J., 117 
Childe, C. P., 167 


Children, employment of, 1-2, 65, 
176; mental capacity of, 22-3, 
26-7, 167, 282, 284-5 ; health of, 
64-5, 132, 167, 168, 169, 285, 286 ; 
in secondary schools, occupations 
of fathers of, 283-4. See also 
Education. 

Cholmeley, R. F., 70 
Civil Service, 70 
Clark, Colin, 63, 156, 161 
— , Dr. Veitch, 164-5, 167 
Clarke, F., 5 
Clay, H., 56, 57 

Coal industry, 205, 227, 234, 243, 245 
Colwyn Committee, 159, 160, 189, 194 
Combination, growth of, 60, 205-7, 
215, 222 

Cotton industry, 117, 205, 227, 234 

Dalton, H., 181, 185 
Death duties, 155, 185, 187 
Death-rate, 66, 151, 164-6, 167-8 ; 
infantile, 153, 164-6, 167; 

maternal, 169 
De Tocqueville, 75, 95 
Dibelius, W., 6 
Diplomatic service, 68-9 
Durbin, E. F. M., 148-9 

Education, 1-2, 5, 65-6, 117, 146-7, 
151, 153, 154, 171-80 ; expenditure 
on, 153, 158, 161, 290; of 

governing classes, 67-71, 288-9. 
See also Children 
Electricity, 238, 245 


292 



INDEX 


293 


Factory Acts, 224-5 
Family allowances, 146 
Fisher, Irving, 129 
Foreign Office, 68-9 
France, 2, 18, 24, 34, 52, 53-4, 57, 
70, 81, 87-8, 93-5, 97-101, 102-3, 
105, 108, 225, 256, 257 
Fremantle, F. E., 193 


Garvin, J. L., 19 

Germany, 51-2, 53, 70, 73, 94-5, 108, 
204, 206, 252-3, 254, 270, 271 
Ginsberg, M., 29, 69, 116, 126 
Glasgow, 66, 132, 164-5 


Health, public, 146, 152-3, 153-4, 161, 
164-9, 193; expenditure on, 158, 
161, 290. See also Insurance. 
Henderson, H. D., 134 
Hobson, 232 

Household, H. W., quoted, 173 
Housing, 132, 167, 1 70-1 ; expendi- 
ture on, 290 
Humanism, 8 1-4, 87-8 

Inchcape, Lord, 130 
Income, national, distribution of, 63-4 
Income tax, 152, 155-6, 187 
Industry, public control oL 234-45, ^73 
Inge, Dean, 19-20, 21 
Inheritance, xiii-xiv, 57, 129, 133-5, 
184-5 

Insurance, health and unemployment, 
181-3, 290, 291 
Ireland, 57, 108 
Isserlis, L., 167 

Jcvons, W. S,, 151, 152, 162 
Joint Industrial Councils, 231 
Jones, D. Caradog, 41, 57, 117, 158 


Kerr, Dr., 167 
Keynes, J. M., 112, 113 

Land, public ownership of, 243 
Laski, H. J., 67-8 
Lecky, 2 
Lincolns Inn, 69 
Lothian, Lord, 219-21 
Lowe, I, 153 

Maine, Sir Henry, 113 
Manchester, 66, 164-5 
Marquis, F. J., 117 
Marx, 58, 13s 
May, Erskine, 2 
— , Sir George, xv 
Mill, J. S., 23, 24, 26 
Montesquieu, 28 

National Debt, 156, 160 
National Investment Board, 197 
New Zealand, 146 
Newman, Sir George, 161, 167 
Newsholme, Sir Arthur, 166-7, 169 
Nightingale, R. T., 68 

Orwin, C. S., 243 

Pareto, Prof., 19, 21, 32, 34-5 

Parry, Sir Edward, 14 

Peel, W. R., 243 

Pensions, 18 1, 183, 290, 291 

Pigou, A. C., xi, 192-3 

Pollard, A. F., 221-2 

Poor Relief, 157-8, 290 

Population, occupied, statistics of, 

52-4 

Railways, 205, 238, 245 
Rathenau, Walter, 203 



29 + 


INDEX 


Rationalisation, 223, 226, 233-4 
Rignano, 185 
Roosevelt, 257 

Russia, 52, 145-6, 183, 252, 253 

Savings, of small investors, 57, 1 58 

See, Prof., 124 

Selden, 245 

Siegfried, Andr^, 6 

Simon, Sir Ernest, 134, 170-1 

Social services, 136, 137, 144-97; 

expenditure on, 143, 157-8, 290-1 
Spencer, Herbert, 156-7 
Stamp, Sir Josiah, 53, 56, 63, 191 
Stephen, Sir J. Fitzjames, 123 
Stockton-on-Tees, 66 

Taine, 2 

Taxation, 136, 155-6, 157, 160, 163, 
187-91 ; proportion of, borne by 
working classes, 156, 161 
Taylor, Jeremy, 25 
Thiing, E., i 
Trade Unionism, 226-34 


Trusts. See Combination 
Turner, F. J., 102 

Unemployment. See Insurance 
United States, 5, 18, 23, 43, 46, 49, 
52, 53, 67, 74-5, 93, 101-2, 120, 
146-7, 181, 204, 206, 215-6 

^ 33 - 4 ) 256. 257 


Voltaire, 81, 107 


Wage-earners, percentage of, in 
different countries, 52-5 ; agricul- 
tural, 54 ; property owned by, 
55-7 ; opportunities of, for rising, 
67-70, 116-7; expectation of life 
of, 151 ; share of taxation borne 
by, 156, 161 

Wealth, statistics of distribution of, 
xiii-xiv, 56-8 

Wedgwood, J., 57, 134, 139-40, 185 
Webb, Mr. & Mrs., 145, 244 
Wells, H. G., 8, 247 
Wertheimer, E., 6 

Young, Arthur, 96 




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